Sometimes the answer to a complicated question is a simple one. The question, ‘why are we not building enough affordable homes?’ has a very simple answer. Not enough homes are built today because the net present value of developing and building today is less than the net present value of developing and building at some point in the future. Too rapid an increase in land value has taken place, thanks to hoarding, speculation, and above all, cheap credit. As Sean Keyes reported this week, land development companies are handing money back to shareholders rather than using the cash to develop…

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