Re: Tons of inflation
> 1) Buy a field from a farmer; 3) See what happens next...
Yes. Current green belt policy is pretty much exclusively why we don't have a functioning market. That was my point. The price of land is nothing to do with the actual price of land - you can buy agricultural land for about £6K an acre - so it isn't a land supply issue, it's a planning an approvals issue which entirely self inflicted by policy and therefore fixable.
> So let’s consider building 15 million houses. That would destroy current property valuations for generations to come.
Sure, but as you so clearly point out 15 million houses are not going to appear overnight, so the banks will have plenty of time to adjust. If it takes 100 years then I think we're screwed (that's slower than the current rate of building, which isn't fast enough to keep up with population growth, let along alleviate some of the pressure).
> Optimistically over the next 10 years we might build 1/10th of that.
As population is currently growing relatively consistently at around 5 million heads every 10 years we'll need to to a lot better than we are now (i.e. if we keep building ~160K houses a year nothing really changes).
> or incentivise house building [which can only really be done via tax reductions]
You just need to relax planning and free up some (OK, quite a lot of) land (and possibly tax those who sit on land banks to avoid them hoovering up the supply to keep prices high) - market forces _should_ take care of the rest. The material cost of a house is not that high once you factor out land prices (which are self inflicted costs, which are entirely within the remit of the Government to fix).
> but pointing the finger at preceding generations
It's got nothing to do with pointing the finger at anyone. House prices cannot sustainably rise at 10% a year when underlying wages are stagnant - it's a monetary fiction which is going to either implode or turn the entire economy in to a Japanese basket-case. Building more houses is the only way to release the pressure - sure, you can't do it instantly without ballsing up the financial system, but it needs to happen at some point. Sky high housing costs just make much of the UK uncompetitive for many industries, or are a massive hindrance to labour mobility - neither is good for the long term health of the economy.