Baby steps, baby steps - Guardian correctly divines the cause of high housing costs

But, sadly, doesn't manage to come up with the right solution to this problem. Still, baby steps, the correct diagnosis is a step toward crafting a solution:

The rooms in their houses are likely to be cramped: Britain is reckoned to have the smallest new-build homes in Europe, partly because there are no mandatory national space standards. And too many of these places lack the shared spaces and amenities that might give them some small sense of community: meeting halls, sizeable play areas, any space for businesses beyond a single small supermarket.

What is going on here? Since 1995, the total value of UK land has increased more than fivefold. According to the Valuation Office, whereas the average price of agricultural land in England is £21,000 per hectare, the equivalent with planning permission for housing now comes in at a cool £6m. Impossible land prices cut out developers beyond the tiny handful of giants who dominate the market. The sums they have paid for their plots have consequences not just for house prices, but basic standards: developers too often try to make their profits by building houses as cheaply as possible, and squeezing the share given over to “affordable” homes.

As we have been saying, ad nauseam, there is no shortage of land in Britain upon which houses could usefully be built. There is a shortage of land upon which housing may be built which is why that gross price difference between land where the permission exists and where it does not. 

There is a simple answer to this, grant more permissions and the cost of them will decline.

There is another problem which you readers here have pointed out to us. Which is that affordable housing requirement. This is a tax upon the building of new housing. If you build some number of units then you must also build some other number of units which cannot be sold at their cost of building. Yes, this acts as a tax - we get less of the things that we tax thus we're getting less new housing as a result of the affordable requirements. Thus we should abolish said requirements as well.

Fortunately, if we solve the price of building land problem by just issuing more permits then we don't need the special allocation of affordable housing simply because we'll have made all housing more affordable by the building of new houses. Further, of course, cheaper building land will lead to less squeezing of units onto a no longer extremely limited supply, neatly solving the size issue as well.

The Guardian's proposed solution involves more tax and more regulation. That government should do more. And we do agree that government should do more here. You know, issue more permits. Or, even, do less by deconstructing the system which requires such permits.

As we say, the analysis of the problem is pretty good. Britain's housing prices are caused, at least in large part, by the cost of land with permission to build. So, increase that supply and prices will decline. What's difficult about this?