Britain’s Declining House SizesComing to the US?

MeasuringHousing

Affordability:MedianMultiple

Median House Price/Median Household

Income

(Used by UN, OECD and others)

Median Multiple (Price to Income Ratio)INTERNATIONAL:1980s-2000s

Single Family Multi Family0

500

1,000

1,500

2,000

2,500 2,438

1,029

1,227

653

Squa

re F

eet

Data fromRoyal Institute

of BritishArchitects

New House Size: US & UK2009

UnitedStates

UnitedKingdom

Large Family House Semi-Detached House Terrace House0

500

1,000

1,500

2,000

2,500

3,000

3,500 3,440

1,647

1,020

2,409

925

645

Squa

re F

eet

House Size Decline: United Kingdom1920 COMPARED TO 2009

1920

2009

Data fromRoyal Institute

of BritishArchitects

Terraced(Town House)

Semi-Detached(2-Family House

or Duplex)

Detached

World War I:Ypres (Belgium)

British WarCemetery: Ypres

British War Fatalities1 Million (2.5x WW20

David Lloyd GeorgePrime Minister

1917-1922

Homes fit for heroes

Suburban London

The Result

Elitist Disparagement (Interwar)• An affront to the eye

• ‘slums of the future

• 1938: “their destruction was ‘an eventuality that does much to reconcile one to the prospect of aerial bombardment’.

• …the new style of homes represented 'something worse than the meanness of poverty - the meanness of spirit'

World War II:St. Paul’s (London)

Winston ChurchillPrime Minister

1940-19451951-1955

Post World War IIClement Atlee, Prime Minister

1945-1951: With Truman & Stalin

Town & CountryPlanning Act: 1947

Green Belts

Post World War IICouncil Houses

Post World War IICouncil Houses

Sir Peter HallUrbanologist

Margaret ThatcherPrime Minister

1979-1990

BarkerReports

… to reduce the long-term trend in house price increases to 1.1% a year –compared with the current rate of more than 9% a year – would require 260,000 homes to be built annually. Since then, an average of just 115,000 homes have been built in the private sector each year.

Post World War II: USHOME OWNERSHIP INCREASE

Levittown (NY):Birthplace of theAmerican Dream

Lakewood, California(Los Angeles Area)

1900

1910

1920

1930

1940

1950

1960

1970

1980

1990

2000

2010

0%

10%

20%

30%

40%

50%

60%

70%

80%

From Census Bureau

Home Ownership Rate: 1900-2013UNITED STATES AVERAGE

Figure 33

• U.S. nationally syndicated newspaper columnist Neal Pearce implied that the Columbine High School massacre, was caused by urban sprawl.

• Suburban bankruptcy predictions

• Faceless estates. Soulless financial districts.

Elite Disparagement

1950

1960

1970

1980

1985

1990

1995

2000

2005

2010

0

1

2

3

4

5

6

7

8

9

10Less Restrictive MarketsMore Restrictive Markets: Outside CaliforniaMore Restrictive Markets: California

Med

ian

Mul

tipl

e

Housing Affordability 1950-2012MAJOR US METROPOLITAN AREAS: MEDIAN MULTIPLE

Median Multiple: Median House Price divided by Median Household Income

Figure 35

Greater PriceVolatility

$550,000 (2007)Houston Exurbs

(Katy)4,500 square feet

Lot: 0.4 Acre

$550,000 (2007)Los Angeles Exurbs

(Simi Valley)1,700 square feet

Lot: 0.1 Acre

MANILA SICK

Priorities areWrong

• Why did people move to the cities?• Not light rail, good urban planning• To have better lives

• Yet urban planning is – Reducing the standard of living and increasing poverty

• Need to replace policy based on means (inputs)– To policy based on ends (Outputs)– Maintain the standard of living & reduce poverty

Anti-Smart Growth Government Re-electedNEW ZEALAND SEPTEMBER 20, 2014

David Seymour