Only Build Houses If They Can Be Bought

The calls for more government spending to boost the economy are coming thick and fast now as we start the long and painful run up to the Budget. This time it's all about building more homes. Now, forgive me if I'm wrong on this but if there is a demand for houses then they will be built because they can be sold. That's pretty basic economics really. Building 50,000 extra houses just for the sake of it doesn't make any long-term sense if people can't buy them. It might give the builders some money but that's akin to giving money to bail out the banks and that's done the economy no long-term good at all.

If as some are suggesting extra housing needs to be built as the population grows surely it makes more sense to make it more straightforward for them to be built by reducing bureaucracy and letting the market dictate what happens next. Banks and building societies are naturally going to be more cautious than they were and quite rightly so - why lend to someone quantities of money which are so high the likelihood of default is high. And this is on top of significant debts first-time buyers might already have such as Student Loans. Get the conditions right and the market will do what's required, don't throw money at it and hope for the best.