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Thesis title: Landbanking as a coping strategy for large-volume housebuilders in the UK housing market and planning policy context
Primary supervisor: Nikos Karadimitriou
Secondary supervisor: Claudio de Magalhaes
Starting date: Spring 2012
Projected completion date: Winter 2013
Despite the recent housing boom in the UK, housing production by the private sector remained relatively steady. As house prices grew well beyond the reach of most, community groups and government bodies spurred by the presence of undeveloped and derelict land in areas of intense housing demand levied accusations of land hoarding and speculation at housebuilders. Housebuilders instead blamed the restrictive and onerous UK planning system that limits the availability of developable land and makes housebuilding unprofitable.
Yet, it is true that housebuilders maintain stocks of undeveloped land in land banks; in many cases, these land banks are equivalent to several years’ worth of housing production and a substantial percentage of these plots will have planning permission in place. Certainly, a housebuilder’s land bank serves as a store of a vital production input for future housing output. However, land also has intrinsic value as a scare resource (highly perceived as such in the UK) and this value rises over time. More significantly, land in the UK can also experience tremendous uplift in value if there is planning permission to build upon it, especially permission to build houses.
It would seem reasonable for a housebuilder to use a land bank to build houses as quickly as possible in the midst of a boom or to sell land to others to build houses instead. I believe that housebuilders maintain land banks as a strategy to both ensure future production and, more importantly, to create financial value by directing land through the planning system. Indeed, the resources employed to create this financial value may be more than those employed to build houses because the financial value created by managing land may be more than the value created by building houses.
- Biography
Michael Manlangit completed a BEng in mechanical engineering at McGill University, Canada. After several years, Michael returned to studies and completed an MSc in quantitative finance at Birkbeck College, followed by another MSc in development and planning at the UCL Bartlett School. After completing his second master’s degree, Michael entered the PhD Planning Studies programme at the Bartlett where he is researching land banking behaviour by housebuilders in the UK under the supervision of Dr Nikos Karadimitriou and Dr Claudio de Magalhães.
Although the primary focus of his research is housebuilding in the UK, in general, Michael is interested in the economics and finance of real estate development. He is also involved in international comparative studies of urban regeneration as well as land use regulation and development control.
Michael is also interested in housing provision in the developing world. He maintains an affiliation as a Visiting Researcher with the Philippine Institute for Development Studies where he studied methods of widening access to housing.