Why do Garden Cities Face Opposition - And what are the Counterarguments?

Large-scale building might be an important part of increasing the UK housing stock if objections can be overcome. But investor-led homebuilding drives development now.

There is a growing movement to rapidly increase the supply of housing in the UK through the building of "garden cities." These are essentially large-scale developments of at least 15,000 homes, historically clustered around village greens and established with their own infrastructure and local government. Modern versions are designed to be environmentally sustainable, even sometimes qualifying as "eco-villages" that promote a lower dependence on fossil fuel use and which encourage more active lifestyles among residents.

But in the UK, protection of countryside lands and the official greenbelt areas have long been part of the culture and official government policy. Consequently, large-scale development of all types is appropriately met with a critical, sometimes sceptical eye. To the proposals being actively promoted by Deputy Prime Minister Nick Clegg, cries of opposition arose almost as quickly as his official announcements were made in support of garden cities in early 2014.

The alternatives to such large-scale developments are to build on brownfield land, or incrementally at the edges of cities where employers need workers who can afford the local housing. Joint venture land opportunity specialists currently work in tandem with homebuilders to create these communities; they accept responsibility for creating infrastructure to support the added population, usually without need for adding entire community support systems because this kind of growth is less impactful on municipal services.

Each complaint against garden cities stands on its own as a legitimate reaction to government-assisted, large-scale development. But for every argument there is a counter-argument. Here are the key points of this pro-con garden cities discussion:

NIMBYism - It's difficult to find anyone who wants big changes in their towns, particularly if it eats up adjacent countryside lands - hence, "not in my back yard." Ramping it up further, political parties may fear a shift in the types of voters who might land in their jurisdiction and effectively vote them out of office (as might occur in Buckinghamshire, Warwickshire and Oxfordshire if more Tories are overwhelmed with an influx of Labourites). NIMBYism is more likely to find proponents in the South East districts of England, less so in the areas north of London and in Wales where development is desired.

Sprawl - The primary motivator in establishing the UK's green belts in the earlier parts of the 20th century was to avoid American-style sprawl, where towns and cities would lose their identity with a melding of two or more municipalities and natural countryside beauty was lost. But one of the first garden cities, Letchworth, proved these things need not happen when properly planned and placed. By contrast, Stevenage and Milton Keynes were considered less successful in this regard and should serve as a lesson in planning for new garden cities.

Infrastructure overload/government spending - Schools, hospitals, roads, sewers and utilities all experience greater demand when the population goes up - particularly with new housing that typically accommodates growing families. With a garden city, those necessary community components need to be built alongside houses, of course, and the costs of those things are incorporated into the price of the homes - unless, of course, the Government provides assistance, as Mr. Cameron has offered to do (allocating £1 billion to new garden city infrastructure costs). With smaller-scale developments, homebuilders are obligated to pay a Community Infrastructure Levy or provide for new infrastructure by other means.

Design and density - Aesthetics are a core issue in housing development, particularly when it removes greenfield vistas and replaces them with roofs and roads. But Letchworth is renowned for achieving at least the appearance of somewhat utopian vision, and the Charles Wolfson Charitable Trust has established a £250,000 prize to planners and designers who can come up with the best design for a sustainable, 21st century garden city. With a rising population, that means 60 households per hectare, and far less dependency on auto transportation.

Given the crush of demand for housing, a variety of solutions should include garden cities as well as traditional development (at an accelerated pace). Private financial interests are actively pursuing the latter, as real estate investment trusts, property fund partners and institutional investors are assembling investors and homebuilders to establish homes where the needs are greatest. Individuals who consider such investments should always speak with an independent financial advisor to identify where real estate best fits their overall asset building strategies.

What Are the Potential Scenarios for Housing in the UK in 25 Years?

The situation is dire if population growth and home building continue at pace between now and 2040. A study examines the numbers and makes investment recommendations.

If you are a parent with children under the age of 10 today in the UK, it might be a good idea to stay on good terms with them.

That's because according to research by the firm KPMG, in cooperation with the housing advocacy group Shelter UK, there's a good chance your children may continue living with you well into their 30s. Blame the potential trajectory of housing costs through the foreseeable future - your children might face even greater difficulty establishing their own households than millions of Brits do already today, given the shortfall in house building.

The report makes recommendations to politicians that involve private and public cooperation - enough to cheer those who are interested in real asset portfolio investing as much as young parents. The report, "Building the Homes We Need: A Programme for the 2015 Government," effectively illustrates an undesirable (to say the least) outcome of inaction or ineffectual action. That report strongly recommends that policies and programmes be adopted to speed the building of homes and supporting infrastructure in towns and cities throughout the UK.

Some of the more sobering statistics for the cost of homes in the next quarter century include: the average price of a home in England will rise from the current £225,000 to £900,000; more than half of persons aged 20-34 will still be living with their parents (it's already up to about 48 per cent); employers in London will have more difficulty attracting younger talent because living near central city offices will not be possible (or, much higher wages will be necessary). Compounding the problem with multi-generation cohabitation is the fact that the average new-build home in the UK is 818 square feet in size, trailing considerably behind those in the Netherlands (1,249 squarfeet), Denmark (1,475 square.feet), New Zealand (1,894 square.feet) and Australia (2,217 square.feet).

In a separate report on a similar topic ("What Will the Housing Market Look Like in 2040?"), the Joseph Rowntree Foundation, another housing advocacy charity, notes that private rents will rise twice as fast as income, and that poverty rates among private renters could reach as high as 53 per cent in 25 years. JRF echoes a number of other housing advocacy parties in calling for a doubling of house-building from 2015 forward, achieving 200,000 new homes each year through 2040.

Shelter chief executive Campbell Robb offers some optimism. "This report proves that the next government can turn the tide on the housing shortage within a single parliament." The report's recommendations include:

1. Allow local councils and their planning authorities to share in the rising value of UK land by creating "New Homes Zones."
2. Charge council tax on un-built homes if a site owner fails to build within a reasonable time period after receiving planning permission.
3. Finance affordable house building through a National Housing Investment Bank that provides lower cost, longer-term loans to housing providers.
4. Provide Government guarantees on financing to small builders, improving their access to finance.
5. Integrate housing and infrastructure as the centrepiece of City Deals to enhance the ability to build homes needed by towns and cities.

In other words, it's a multi-pronged approach that scarcely no one would wish to fail - not politicians, not homebuilders, not affordable housing advocates, not strategic land developers, and certainly not families with adult children occupying smaller homes. This is a problem that has sweeping economic and cultural implications.

Independent financial advisors are often called upon to work with would-be investors in real estate and other real asset investing. They can examine the broader issues in family wealth building to see where these kinds of investments match up against other investments such as market-traded securities. Helping build a better Britain for the future is certainly a noble gesture, but it needs to fit one's own investment objectives and goals as well.

What are the Largest Brownfield Developments in the UK - and Why are There so Few of Them?

Brownfields can be more costly to build on and sometimes fail to provide the kind of housing needed. Occasionally, however, they provide a good return on investment.

Brownfield development has been trumpeted as the perfect solution to the UK's housing needs and a means to contain sprawl that threatens the countryside. So why have the country's homebuilders delivered so little on these sites? And what does that tell residential development investors – such as those who look for capital growth land opportunities - about where to put their money?

Since 1998, the Government's target was for 60 per cent of all new residential developments to be built on brownfield land. A 2006 statement, Planning Policy Statement 3 (PPS3), reiterated that goal, with renewed pressure on local planning authorities to actively incorporate brownfields into local plans. By 2008, the Department for Communities and Local Government called for a National Brownfield Strategy in a report ("Securing the Future Supply of Brownfield Land") that outlined ways to remove regulatory obstacles as well as to encourage non-residential development of some brownfields (e.g., use the land for green spaces, nature conservation and flood mitigation, but not homes). While more of a concept than law, developers and planning authorities alike regarded it as an established target.

Some brownfield sites are in development on a significant scale. The Avonmouth and Severnside development in the Bristol City region, largely a job-producing enterprise area with some residences, is said to be the largest brownfield development in Western Europe. At Bishopton in Renfrewshire, west of Glasgow, a 1000-hectare site that formerly contained the Royal Ordnance factory is proposed for redevelopment with 2,500 homes. Eric Pickles, Secretary of State for Communities and Local Government, believes there is collectively 5,000 hectares of brownfield property on which 200,000 homes could be built.

Yet, brownfield lands have not had a crush of development in this time. This is due in part to the recession that began in late 2007. Since then, a credit crisis has gripped much of the country, disallowing younger people to get loans to purchase homes (subsequently addressed by various government schemes, such as the Help- to-Buy programme).

But other factors have gotten in the way as well. According to an overview of the National Brownfield Strategy published by Politics.co.uk, these include:

• Brownfields take too much time. The 2011 draft of the National Planning Policy Framework, which simplified planning processes with the goal of speeding up housing development, was viewed by environmental and conservation groups as de-prioritising brownfield development in order to achieve faster growth.
• Brownfield costs are prohibitive. Development on brownfield sites are almost always more expensive. The sites very often require remediation due to toxins or other contaminants, and existing buildings sometimes require demolition.
• Brownfield red tape. Site preparation not only costs money but also time in obtaining necessary permissions.
• Brownfields limited to lower-price housing. The types of residences that result are more often high-rise apartments than pricier single-family housing. In some areas, that fails to satisfy market demands.
• Brownfields may be in flood zones. Some brownfields fail to satisfy Planning Policy Statement 25, which limits building in flood-prone areas. Given the predictions for increased flood risk in the coming decades, this is a very real consideration.

For a participant in real asset funds, for example, a brownfield development might still prove to provide asset growth that beats alternatives. It takes skilled real estate specialists to identify where barriers can be overcome and where the market demand for housing is great enough to overcome the obstacles. Non-specialists with cash to invest should speak with an independent financial advisor to help sort through these questions.

What are the Differences Between Rampant Land Speculation and Solid Land Investment in the UK?

With foreign investment driving up land prices, speculation strategies beckon. But land development investments are more stabilising for investors - and the country.

The discussion about the differences in land investors - those who speculate on rapid value increases versus those who make their money by building things - is nothing new in England or elsewhere. But the rhetoric in the UK has ratcheted up a bit in 2014, along with the rise in real estate prices.

How would someone investing through UK land fund managers think of themselves? Are they speculators, or solid land investors? Does the fact that land funds largely involve the conversion of unused land into developed property - housing and commercial use - place such an investor in one category and not the other?

Anyone with the pounds to invest and who follows the topic of UK strategic land development might be familiar with the arguments. A laissez faire advocate would suggest that natural market forces should be allowed to rule, meeting the demands for commercial, residential and agricultural uses at the simple intersections of supply-demand curves. If holding land for several years turns into healthy profits, why should it matter? At the other side are those who present the housing shortage as cause for different kinds of regulation, incentives and taxation, and that even greater value increases can be realised by the mid-term investor compared to the speculator.

An example of the latter is advocated by ShiftingGrounds.org, an independent organisation that proposes alternatives to the status quo of British politics. In a recent (November 2014) post by economist Joe Sarling, an argument is put forth to impose a land value tax on the ownership of land, irrespective of buildings that sit on it.

Among Sarling's principal points for this is it would prevent speculative buying-and-holding. "It would encourage land owners to better use their land…bring it forwards for development...[and]...stabilise land prices as investors would have to think carefully about how they use the land and their build-out rates," says. "As a result, land speculation would be discouraged and prices would stabilise. This, in turn, will stabilise house prices which helps the consumer plan to buy and the developer as they have confidence in predicted values - i.e., it would dampen the boom-bust cycles and bring developments forward more quickly."

Labour shadow housing minister Emma Reynolds has her own beef with unused land, more specifically large empty homes that are often owned by foreigners as mere investments. She points out that the very active home-sales market in Cambridge provides a good example of this happening - which she would like to slap with a large council tax to discourage.

Looking at these and other arguments on land speculating vs. investing, one must also consider the farmers who remain engaged in the business of agriculture. Investments by billionaires, both from within and outside of the UK, of prime arable land illustrate how they too have their economic equations to consider. Over the past decade, the better tracts of farmland have appreciated by 210 per cent, including an average increase of 11 per cent in 2013 (and up to £11,000 per acre in Herefordshire and Eastern England, according to the Knight Frank Farmland Index).

Speculators can be big winners or big losers, depending on the larger forces of global economies. But developers and farmers, working closer to the ground (so to speak) at making land productive are subject to less volatility. Getting past the rhetoric, investors who consider strategic land development programmes (i.e., buying land to achieve planning authority permission to build) are nonetheless advised to speak with an independent financial advisor to examine more closely which type of land investment best suits their needs.

Two Million Working Adults in the UK Live with Parents - What is the Investor's Opportunity?

The numbers are unfavourable to both buyers and renters, particularly those under 40. So employers, investors and homebuilders are looking outside of London.

A significant social trend has been happening in the UK that has gone quietly unnoticed. Almost two million working adults, ages 20 through 34, still live with their parents. That’s 48 per cent of people that age. This delays the start of new households, it affects consumer spending, it often leads to family strife – and it may be up to investors and developers to fix it.

The obvious problem is that housing is too expensive, with prices rising annual by double digits in many cities even while wages remain relatively flat. Young, working adults have to save longer to get deposits on homes, which continue to be priced beyond their grasp. A clear solution is to build more and perhaps decentralise where workplaces exist, which can mean building in places other than London and its fringes. UK land fund managers, who help convert unused properties into residential and commercial districts, understand well how this pent-up demand represents a strong emerging market for homes and flats in the decades to come.

In Japan, this has been happening for more than two decades already. Faced with a stalled economy, an entire generation of unmarried adult children have opted instead to remain living with their parents and spending their earnings on consumer goods (the common term is “parasite singles”). In southern European cultures, it is historically common to remain at home until and even after marriage. But in the UK, the US and many other countries, launching into adulthood has meant finding their own place to live as soon as possible. And that is not currently happening for about half of Britain’s young people.

With data accumulated by Nationwide, the UK mortgage company, it’s clear why this is happening. Prices have climbed back to near or above 2007 levels, the historic peak (higher in London, Bristol and Cambridge, lower elsewhere). Mortgage payments themselves have become more affordable since the 2009 interest rate cuts (now consuming, on average across all age groups, 16 per cent of homeowners’ incomes). But deposits required of first time buyers are now around 20-25 per cent of the purchase price, which is rising rapidly with the prices of homes. With fewer people buying, more are renting – driving up the rental rates as well. This is a primary reason why those young people continue to struggle with finding an affordable place to live.

The problem is somewhat regional, of course. Homes in London for first-time buyers are on average 7.5 times the average earnings of workers there. But across the country, that ratio is lower at 4.3 times earnings. Still even the lower figure is high by historical standards.

So what is the role of the developer, homebuilders and investors? Simply, to increase supply that will create downward pressure on prices for both buying and renting. But given the regional nature of high housing costs, something new is happening: younger people are leaving London. According to the Office for National Statistics, thirtysomethings are moving to places such as Birmingham, Bristol, Manchester, Nottingham and Oxford. These are people who are on the move, not interested in becoming “parasite singles.”

Given that, investors need to start thinking outside of the London box. This is why employers and alternative investment funds are increasingly looking west, north and southeast of the capital city for land where homes can be built and be affordable at market rates to buyers. This also has the effect of diminishing wage pressures on employers.

UK land investors should consider the opportunities of pent-up housing needs, but also where any type of real estate investment fits into their own wealth building strategies. An independent financial advisor can guide individuals on questions such as these.

The UK's "Rent Trap" - How Can Land and Housing Investors Provide Solutions?

Fewer people are buying than renting homes in 2015. This likely has broader social and economic impacts in Britain - which private sector investment can mitigate.

Home ownership has generally climbed in the UK over the 20th century, in fits and starts and with major disruption in the aftermath of World War Two. But in the past decade, particularly in the wake of the 2008 financial crisis, ownership rates have dropped from 69 per cent to 67.5 per cent (from 2004 to 2008)  - due to the rapidly rising prices of homes against flat wages and more stringent lending practices. According to Government statistics (Department for Communities & Local Government, English Housing Survey 2012-2013), of the 7.5 million private renters in the UK, two-thirds are unable to save up money for a home-purchase deposit, probably because on average 40 per cent of their income is spent each month on rent.

This is a key consideration for the residential building industry as well as its financial backers. Strategic land developers work at unlocking areas that contain no housing to get planning authority approvals to build; this is an essential component of increasing the country's inventory of residences. If the supply of homes can rise - a key task that almost no one opposes - then simple economics dictates the price of owning and renting will plateau and perhaps even drop.

The social impact of fewer owners can play out in many ways. Households that fail to get on the property ladders, the so-called Generation Rent said to be in the "rent trap," are arguably disadvantaged as are their children and communities. Some statistics to bear in mind include:

• Wealth accumulation - Owners see their investments grow over years in which they occupy their homes. While economic crises can alter this in the short-run, historically homes rise in value even as mortgage-based costs remain relatively static.

• Ripple effect - As values of homes rise, those who own feel richer and tend to spend more. Within reason, that is good in that it feeds the broader economy.

• Advantages over market-traded investments - The markets tend to be more volatile than home prices. In the two years following the 2008 crisis, market shares traded as much as 50 per cent lower than their peaks, while home prices dropped only 10 to 20 per cent (depending on location). Stocks and bonds have the advantage of liquidity, of course, but the fact that people do not sell based purely on the rise or fall of prices further stabilises against volatility.

• Community stability and investment - The rule of thumb is that owners take better care of their buildings and communities, have higher voter participation rates, have children who fare better in school and experience lower antisocial factors (teenage pregnancy, drug use, school dropout rates, etc.).

A number of years ago, an article in The Economist ("Shelter, or burden?" April 16, 2009) presented a pros-cons case for ownership, challenging some of these assumptions. One could argue that ownership simply isn't for everyone, and that ownership creates rigidity in where people live such that they are hesitant to move for job opportunities in other cities or towns.

But one fact affecting approximately one million British households is this: they cannot find an affordable home through either renting or buying because the supply falls woefully short of demand. For them, it’s not an academic debate. There simply aren't enough houses or flats available to make it affordable for working families.

Public policies such as the Help-to-Buy scheme address this problem from a lending standpoint. A counter-argument made to this from many quarters is that looser lending only pushes prices higher. This Government programme needs to be met by the private sector, where most of the building is done. Even then it is almost always a public-private endeavour, given how investors involved in strategic land partnerships must achieve local planning authority approvals to build. But endeavour they do, adding infrastructure to raw land that enables homebuilders to do their work and create new residences.

Investors in housing come from all areas: foreign and domestic, individuals and institutions. For individuals who are looking at real estate investing for the first time, meeting with an independent financial advisor is highly recommended to gain a full perspective on where such assets best fit the investor's individual needs and objectives.

The Rise of UK House Building and Implications for Land Investing

Housing starts and completions in England are up. But it takes the tenacious and well-advised investor to help the country meet the strong demand for homes. 

Toward the close of 2014, the official Government statistics on house building in the UK are mixed but promising. This offers some degree of hope for investors and builders in the housing sector.

According to the Department for Communities and Local Government, seasonally adjusted housing starts (138,640 homes) now are 93 per cent above the recession trough (March 2009). Completions of homes over 12 months (the year preceding September 2014) hit 116,930, a hike of 8 per cent over the previous comparable time period (the year preceding September 2013).

As is well understood, the country needs to add at least 200,000 homes per year to meet pent-up demand in the face of England’s growing population. So there is no lack of need for even greater residential building in the UK. Investors through such programmes as joint venture partnerships understand this very well and seek optimal scenarios for achieving asset growth in relatively short (two to five years) development timeframes.

How do land investors accomplish this? Note that the land investor is different from land speculators and others who may engage in land banking: the individuals involved in strategic land development typically work in a sequence of well-managed steps to bring land into productive use for homes and businesses:

Step 1: Identify appropriate land for purchase - Professionals in land investing comb through economic development statistics to find where job growth is greatest and where locating a workforce optimally serves both employers and employees. From there, negotiations with existing land owners (public and private) with appropriate acreage results in a transaction of land to the investment group.

Step 2: Achieve planning authority approval for use designation - In Step 1, there is a good sense of where local planning authorities (LPAs) may be amenable to a zoning change (often from agricultural to residential). In about half of the country, local authorities have complied with the National Planning Policy Framework (NPPF) to establish local plans for development. In other places, the land fund investment managers make the case for how new development will benefit the area economically, physically and culturally.

Step 3: Build infrastructure - Once LPA approval is in place, the investment group goes about the business of building roads and utilities, site preparation that is essential to orderly and sustainable development.

Step 4: Construct and sell completed properties - At this stage, many investor groups sell the land to homebuilders. This allows an earlier exit from the investment with reduced risks associated with construction and sales. Homebuilders have greater expertise in what the eventual homebuyer wants and can afford.

Investors typically understand the need to work with specialists (e.g., experts at real asset investing) who can combine capital with expertise to produce asset growth. Similarly, the investor should consult an independent financial advisor to identify broader strategies for including real estate within a family wealth-accumulation portfolio.

The Differences Between Investing in Housing and Mass Infrastructure

From an investor's perspective, the ROI in housing might be greater than that achieved from road and rail projects. But infrastructure is fundamental to development and deserves holistic thinking.

The relationship between housing and public infrastructure has always been strong, even if indirect. One need look no further than the London Crossrail project, which is adding 75 miles of commuter trains to the city's system and where, to no one's surprise, housing values near new system stations are rising rapidly.

But to an investor, if a choice must be made between financing various kinds of infra (transport, utilities, broadband, flood mitigation, and more) and residential development, it can be challenging to determine which might yield the greatest return on investment. These are not simple "apples to apples" comparisons, and the potential for growth in some types of real assets funds is not always easy to ascertain. Yet because the two are interdependent it is entirely logical for investors to consider them within the same investment decision-making process.

This discussion is ramped up by the pressing need for additional housing in the UK. This is strongly incorporated into the National Infrastructure Plan 2014 by HM Treasury, the Government's economic and finance ministry. The report cites several infra projects where housing and public amenities could be inextricably linked if the Plan is fully implemented, as well as where previous public projects have succeeded:

• Suburban network rail connected: A Government loan (contingent on a principal heads of terms agreement) of £55 million to extend the London Overground to Barking Riverside, predicted to help deliver 11,000 homes.

• Land remediation and infrastructure: In Ebbsfleet, a £100 million infrastructure fund will enable up to 15,000 homes to be built in a new garden city.

• Rail upgrades: Already, a major upgrade since 2010 of King's Cross Station rail unlocked 2,000 new homes.

• Road transport and public spaces: A spend of £23 million for a road crossing between Swindon and Wichelstowe (on the M4) opened a new site for thousands of homes. Meanwhile, construction begins in 2015 to provide transport links and public spaces that will transform Battersea, Nine Elms and Vauxhall, with the potential for creating 16,000 new homes.

Very often, both housing and major infrastructure programmes are a mix of private and public funding. But housing exists in a different sphere, providing returns to investors in relatively short order and the majority of homes are built by the private sector. True, financiers, including those who work in real asset portfolio investing, may need to go through planning authority processes, but it is largely a transaction amongst owners of UK land, site assembly professionals, builders of utilities and structures, as well as the private individuals who buy the homes.

Investors working in infrastructure through municipal bonds are not as common in the UK as they are in the United States and other European countries. The majority of local government borrowing is historically through central Government, but since 2014 a consortium of local councils has begun to fund the Local Capital Finance Ltd. Agency, which takes bonds to investors. The Chartered Institution of Highways & Transportation called for a greater sense of interdependency in public and private projects in a 2012 report (Action Plan for Change; Infrastructure Funding & Delivery), stating "A hybrid public and private sector infrastructure fund should be created for a discrete geographical area which, whilst not generating mainstream capital market investment returns, would deliver infrastructure that benefits local land values and local businesses." The problem, argue some, is that infrastructure lacks data and benchmarking, lending an opacity to municipal investments that makes councils and investors skittish; the broadest benefits of roads, rails and flood abatement are at best proven over decades, not quarters or fiscal years.

Investors need to weigh many factors relative to development in the UK. While the overarching economic factors of population growth and housing inventory suggests strong opportunities, individuals are wise to engage an independent financial advisor to examine where development projects fit wealth building objectives.

How Have Greenfield-Brownfield Swaps Already Enabled House Building?

Local councils are tasked with writing home building agendas. That might require eating into green belts - but "third way" solutions can lessen the loss.

A community meeting at the Wilmslow Library in Cheshire (south of Manchester) in January 2013 illustrated both the problems and solutions around homebuilding in the UK. For anyone considering investing in capital growth properties, listen up: These local residents and their planning authorities hold the cards on development.

In this standing-room-only meeting, campaigners for green belt preservation challenged the consultants presenting a Draft Local Plan, which proposed that a number of homes be built on what is technically Greenfield and green belt land. Included was a proposed community in adjacent Handforth, largely self-contained with 1,800 homes with area for an additional 500 homes in future years. Opponents argued that at least 800 homes could be built on brownfield land. Defending the plan, one consultant said, "Clearly locally there will undeniably be considerable impact on green belt. It would be foolish to suggest otherwise, but rather perhaps that we put an impact in a concentrated way than perhaps scatter it far and wide."

The entirety of the conversation was far ranging, but it provides evidence that a “nibbling” into green fields is being pursued for homes development. This community is required by the Government to develop a long-range plan to increase housing overall, a national imperative to accommodate a growing population and to overcome the deficiencies in building over the past decade. And yet, the solutions are not simple.

The Campaign to Protect Rural England (CPRE), which advocates for absolute preservation of green belt land, fears that the Localism Act of 2011 endangers green space overall. In contrast, Chancellor George Osborne seems to indicate a nuanced position, that trading off some green space for development in workable if land elsewhere is brought into the greenbelt. Counter to the insistence by CPRE that greenbelts be preserved, former Under-Secretary of State, Department for Communities and Local Government MP Nick Boles speaks about the viability and deliverability of land for housing, which in many places means that green fields and green belt lands are more economically feasible than brownfield land. Some such locations where this approach is already in some level of discussion and planning:

• Nottinghamshire/East Midlands - In Broxtowe, more than 1,100 dwellings are proposed, with an additional 5,000 homes in Rushcliffe.

• Cambridge/East of England - With 11,000 homes built on green belt lands since 2003, with an additional 1,880 proposed. An area north of Waterbeach Village is being proposed for a green belt swap.

• Bedfordshire/London Metro Green Belt - About 11,000 homes are proposed for construction by 2031. Additionally, a 52-hectare area is requested for a rail freight terminal.

• Epping Forest district/London Metro Green Belt - With the release of 1 per cent of this green belt, 1,250 dwellings could be built.

• Cheshire East/North West - To accommodate 5,680 homes, the council proposes swaps and extensions that alter the green belt footprint.

• Christchurch and East Dorset/South West - 3,000 homes in the Local Plan Core Strategy on green belt territory.

• Birmingham/West Midlands - The construction of 30,000 homes would be in addition to 43,000 dwellings on brownfield sites. This is on green belt land, where the Birmingham Airport might expand along with the addition of a major high-speed rail line.

Of note, there are things other than homes (rail lines, airports, office parks) that are part of what nibbles at the green belts. All speak to overall population growth, and the challenges of maintaining metro boundaries set forth almost a century ago.

Where does this leave the investor? For individuals and institutions that recognise the pressing need for and opportunity in development, it’s a recognition that English cities are bursting at the seams. A capital growth fund focused on housing and commercial development looks for ways and places to build which support the economy and alleviate the housing shortage. But it need not be an either/or situation. A distributed approach to green fields, adaptive to commercial centres and efficient and clean transportation modes, helps address 21st century needs with coherent solutions. Green-brown swaps, if developed in good faith, might be the "third way" means by which to satisfy all parties.

Investors should also approach all involvement in real estate with a balanced understanding of the risks and rewards. Be certain to consult an independent financial advisor before entering any investment.

Can the UK afford to Shift Land Use from Agriculture to Development?

The beautiful countryside is indeed a national asset. But housing and commercial development are not necessarily less "green" than farming.

The UK is blessed with two very important resources: A growing population, which is testimony to the vibrancy of the culture and its economy. Also, the country is verdant, with green countryside making up the vast majority of the country's total land mass, 43 million acres dedicated to arable farms and rough grazing land, with another 13 per cent of land either greenbelts or "areas of outstanding natural beauty."

Unfortunately, these two factors appear to many to be in conflict, that the growth of population necessarily leads to a reduction in green areas. This is a debate that has influenced public policy for at least one hundred years, going back to the establishment of the first green belts that wrap most major and mid-sized cities. And while builders and investors (such as those who do real asset portfolio investing) are more typically associated with building on agricultural and greenbelt land, there is also some degree of development that can be feasible on brownfield and infill sites in towns and cities.

The country depends on its home-grown agriculture for 59 per cent of the food consumed here, importing about £32.5 billion of food from outside the country, mostly from Western European countries. Of note, UK agricultural and food industries also export about £14 billion worth of goods per year.

So the question must be asked: What might happen if increasing amounts of land are given to development at the expense of agriculture? Does UK population growth mean the country will increase its dependency on other countries for its food? Might the current policy that favours brownfield development be pursued more robustly in order to minimise land loss to housing and commercial enterprise?

Several points are due consideration in answering these questions:

• Agriculture is not necessarily a clean, environmentally friendly endeavour. About 90 per cent of ammonia emissions (315 kilotonnes per year) are the result of spreading livestock waste. This acidifies soil and leads to eutrophication of soils and water (harmful to habitats).

• Agriculture also contributes heavily to greenhouse gas emissions, including 38 per cent of methane and 66 per cent of nitrous oxide of the country's total. Methane is 21 times and nitrous oxide 310 times more potent than carbon dioxide.

• By calculations presented in a report from Institute for Sustainability Leadership at Cambridge University (Andrew Montague-Fuller lead researcher), more efficient farming methods, reduced consumption of meat and a reduction in food wastage could reduce the need for agriculture land by as much as five million hectares.

• Urban areas of the UK constitute about 9 per cent of the country. Green belt areas occupy 13 per cent of the landmass. Even in the heavily-populated South East, about three-quarters of land is either woodland of farmland.

• 90 per cent of Britons live in this 9 per cent of urban-defined areas. Compare that to Germany, where only 75 per cent live in cities, Italy (65 per cent), Ireland (62 per cent) and India (30 per cent). England is densely populated with lots of green land surrounding us.

Now, to be clear the green fields of the British Isles are about more than just agriculture. The country's robust tourism industry promotes this heavily. Says the website for Visit England, "there's nothing quite like the English countryside for rural escapes with its patchwork hills, dramatic dales, ancient woodland and winding country roads." No one can argue with that. But with an increasing emphasis on sustainability - including an eco-tourism industry that admires sustainable building as much as habitat - might not a shift from industrialized farming to environmentally conscious development be viewed as a positive as well?

Developers must respect the heritage and character of the country. Whether building in England, Wales, Scotland or Northern Ireland, investors such as those working in joint venture land opportunities should work with sensitivity to how new homes affect the world around them. But at the same time, treating agriculture as sacrosanct can be counterproductive on many levels. A balance must be struck in a growing country.

Investors of all types - individuals and institutions - are increasingly attracted to land and real estate for many of the reasons stated above. For individuals, it’s wise to discuss any such opportunities with an independent financial advisor to gauge how real estate fits with overall capital and income growth goals.