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I've a one bedroom in a flatshare in east london, its nothing special & costs north of £1k / month. If a political party outlined how they'd fix spiralling house prices they'd get my vote.



If a political party outlined how they'd fix spiralling house prices they'd get my vote.

It's really not that hard: remove height limits and parking minimums, per Yglesias in The Rent Is Too Damn High: http://www.amazon.com/Rent-Too-Damn-High-Matters-ebook/dp/B0.... Glaeser's The Triumph of the City is also good on this subject and discusses the UK more: http://www.amazon.com/Triumph-City-Greatest-Invention-Health.... This is a simple issue of supply and demand: rising demand in the face of limited supply means higher prices. Want lower prices? You need more housing or fewer people who want it. The former is easy to accomplish with century-old technologies, like steel and elevators.


What do you mean by 'parking minimums'?

FWIW, the London Plan currently contains restrictions on the maximum amount of parking provided:

http://www.london.gov.uk/thelondonplan/docs/londonplan08_ann...

  table A4.2 Maximum Residential Car Parking Standards
  
  Predominant housing type   4+ bed units   3 bed units   1–2 bed units
  Car parking provision      2–1.5 spaces   1.5 – 1 space 1 to less than 1
                             per unit       per unit      space per unit*

  * All developments in areas of good public transport accessibility and/or
  town centres should aim for less than 1 space per unit.


Parking minimums are fairly common in the US, and cause problems especially in cities because they take up so much land. Here is one random article about them, and how inconsistent they are: http://www.citylab.com/commute/2013/08/exposed-americas-tota...

Brazil has problems too - http://cities-today.com/2014/07/finished-brazils-largest-cit...


Um, here is the "outline":

A law that limits the rent increase to inflation + x.

Notes: Circumvention by "also buy this used kitchen for a ridiculous amount" would be illegal as well. Sucks for anyone trying to move into the city but doesn't force everyone who lives in the city to move out.


Sucks for anyone trying to move from one apartment to another. Sucks for anyone trying to move out from their parents' apartment. Sucks for anyone whose landlord invests as little as possible into maintaining the building.

(Obviously sucks for anyone who's invested in real estate but we don't care for these folks, do we?.. Well, it sucks for everyone else as well.)


No doubt there are downsides, however moving around, or leaving parents' apartment is aparently quite difficult anyway with the astronomical rents in London.

Regarding the investors, I am not sure how a reasonable rent increase along the inflation rate would suck; the fundamental building, maintenance and operating costs should also move with inflation. I have a little real estate myself and when I bought, my financial plan did not rely on a crazy rent spike 10 years down the road.

The current low interest rates push so much investment into real estate, while space for construction is limited in many places. How would you fix this situation?


Removing restrictions on building would go a long way towards solving the problem IMO. You'd get uglier cities maybe, with taller buildings in more expensive areas, less parks, etc., but you'd get cities where more people could live, in terms of the amount of apartments per square mile as well as price (as the two ought to go hand in hand at least somewhat.)

I think that today's restrictions on building in many places are absolutely draconian, to the point of a chronic shortfall in the number of apartments built not just in city centers but in entire cities. I think that to some extent this is explained by a collusion of builders, property owners and bribed government officials (so corruption), and to some extent it's explained by the government liking to restrict building to preserve open space or what-not and not liking to do the work needed to plan and execute urban expansion at a decent rate (so laziness).


What makes people try and move to the big cities in the first place? Is it high-paying jobs?

The jobs must go where these people live currently. Inconvenient for companies who like their offices in central (and expensive) locations, but doable.




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