Yes you are correct that fewer properties are being built, and that a huge number of properties that have been built are apartments.

I guess from your comments that you have experience and had the the misfortune to try and negotiate with a Planning Department, with regard to Construction projects ?

Fewer properties (houses) are being built because planners and Government want to protect greenfield sites from development and houses take up more land than apartments.

More dense housing (future slums some would call them) are being constructed because Local Authorities have to meet National Government targets on new build, or be financially penalised.

Buy to let investor also semmed to prefer these type of properties.

The result, the easiest way to meet new build targets and use less land, is to build apartments which are now in oversupply.

In addition many Local Authorites want to encourage public transport use (even if no public transport is available) so car park spaces are deliberately limited, causing congestion as people park on paths etc.

In addition we now have the wonderful 106 rule which is being applied by some Local Authorities, when Planning is granted, it means you have to make a financial contribution to the Council for them to spend as they like on a local project. like traffic management (traffic obstruction by any other name) or a new roundabout etc, this therefore increases the cost of your development, but has no real benefit to you.

We then have Gordons increased rate of Stamp duty, which confuses the market, and divides it into price sections.

The fact that you will now pay over £20,000 tax when purchasing a property worth £500,000 means margins are suffering when undertaking refurbishment work, to resell on at a later date.
The fact that you also pay 15% VAT tax on all materials used is another limiting factor.

Thank goodness at the moment VAT is Zero for New Build.

So there you are, the Government has increased taxes on cars and housing, and both have gone down the drain, ANOTHER LESSON TO BE LEARNT.

The unemployed are paid for by the taxpayer and teachers are also paid for by the taxpayer. This is not to say that teachers are not valuable to society, it is to make an irrefutable statement that we as taxpayers do pay some in society to perform useful tasks but we also pay others who are far less useful and in some cases arguably do nothing useful at all.

The point I make is rather more fundamental: when we make those who are already paid for by the state redundant from their jobs we do not increase the burden on the state, we actually reduce the burden on the state and on society.

There is little point in keeping notional unemployment levels down by employing unnecessary numbers in government; the effect is in fact the same as paying one group of unemployed a higher benefit than another for no good reason.

Far better that we grasp the nettle and reconfigure the economy by shrinking the size of government, and return the cost benefit to its rightful owners.

His grip, tone and authority get better and better.

Similarly we have advocated a method of creating and illustrating a ‘kitty’ into which all the savings on government waste – (Yes Mr Brown, that’s how we choose to more accurately define ‘Tory cuts’) – can be aggregated to show how our combined efforts are helping pay off Labour’s debt.

Perhaps we can dub it THE PUBLIC PIGGY BANK which, eventually, will provide our children, or theirs’, with a bonus to help safeguard their futures.

You make a very valid points here about trying to undo the harm of high taxes on the car with a subsidy for new car purchases. However, I would take issue with you on the government having encouraged new housebuilding. You have said before that house buying was encouraged house buying in the past with low interest rates from 2000 to 2005 (only then to raise them too high). However, tough planning laws have meant that during the boom the numbers of new homes being built were at record lows, with much of the new build being in apartments and not the more desirable houses. This shortage of new build when demand was (artificially) strong, further exacerbated the house price inflation.

However, you do point to a general principle for a quick, sustainable and affordable recovery – Undo the harm done by higher taxes and more regulation.
In the boom, these extra costs were largely absorbed. They have encouraged a steeper downturn and the increased costs will slow down and diminish the recovery.

Certainly the Labour plan of taxing the motorist, both on new car purchase, and more and more fuel duty increases over the years, has now backfired in a big way.

In the housbuilding industry the elevation of stamp duty rates and banding has caused start and stop points in the market.
Any property valued at 10% above a stamp duty rate tends to stick, as purchasers are often unwilling to pay a higher level of stamp duty tax on a house only margially into the higher rate.

Construction has suffered for years from the full VAT rate being applied to repairs and improvement.

The Federation of Master Builders along with many other Trade organisations have campaigned for a 5% rate of Vat on repairs maintainace and improvement works for years.
The Government excuse given for not being able to do anything about it, has in the past been EU legislation which would not agree to it.

The EU has now seen sense, and from October last year it is now possible to have a 5% rate if any Country wants to take advantage.

Too many construction workers are now idle, too many cowboys who charge no VAT (and thus pay little tax as well) win works against Contractors, who play by the rules, and who are including for the full rate of tax (VAT etc) within their quotations.

We now have Visting labour from other Countries also competing with our own workforce.

Do the sensible thing, reduce VAT, make it a slightly more level playing field for those who play by the rules and let us stimulate this area.

Tax take may increase as a result.

I am afraid it is past that stage. Do you recall those cartoons where the character would run over a cliff and for a couple of seconds float in the air with its legs thrashing but getting no purchase. That’s where the economy is just now. The drop is yet to come. Hat tip to the title of this artical.

NickW: “and all the opprobrium for clearing up the mess is heaped on the Conservative party.”

Yes, I agree that is the tactic.

Now a little off topic but revelant to government spending. We can see what a unified and targeted opposition can do against something like ID cards, the government has practically scrapped the scheme, do you recall when an Id card was going to cost £60 the government for some reason thought there would be queues around the block at that price.

Now they are going to be voluntary and I assume free, which means we have paid for them and waisted millions on what is a completely unnecessary project (given that we are an Island) we just need a fraction of the cost spent on immigration and customs officers.

But the point I really wanted to make, it wasn’t long ago that Michael Howard came out in support of ID cards. The problem is for the Labour party as well as the Tory party, they have still isolated themselves from their supporters.

Thus they both come up with insane and expensive schemes which have not a shred of support in the country, thrash the policy in an attempt to make it popular.

Political parties need to understand that we don’t want to be told what to do by a bunch of shysters. If a man has integrity and hasn’t been dipping his hands in the till for the last ten years then he’ll get a good hearing. But don’t make the mistake of putting the political cart before the horse.

And by the way? We cannot afford to spend £10 billion a year on the European Union!

The unemployed can claim some living costs, and there is the cost of running the Job Centres and administering it all. Perhaps this amounts to £25k per unemployed person per year. Those unemployed signed off on long-term sick pay are obviously more expensive, but maybe not massively more. If it costs more than this, then that’s just another example of the inefficiency of the Public Sector.

That is the bare minimum salary for many of the non-jobs, and that’s before you count the cost of the impact they have on the real world. Think of all the “elfin sayftee” people hampering manufacturing, adding extra red tape. How many stories have we heard of unnecessary outreach workers, or roadsigns being written in Polish for the sake of political correctness?

OK, perhaps some of these are at the extremes, or even urban myths. But it’s rather troubling how believable it all is.

I’d far rather shrink the bloated Public Sector, and use some of the money saved to fund decent Private Sector job-finding for the people sacked as a result. Perhaps use the model of the Princes Trust to encourage people to start new companies.

Governments don’t create jobs. They just use up money inventing things for people to do, to keep down the (fiddled) unemployment figures, and for “social engineering”.