This jornal provides a review of some of the key articles and research examining the
relationship between planning regulation and its impact on the housing market in the UK and the
US. In both countries, demographic change coupled with economic growth has increased demand
for housing units and in the UK, over 4 million new units are estimated to be needed by 2016.
Given these pressures, the interaction of the planning system and the housing market is critical.
The articles reviewed below mainly adopt a mainstream economics approach to modelling the
impact of planning on housing markets. They are concerned with outcomes. An additional or
alternative approach is provided by behavioural analyses of the relationship between planning
and housing development. These enable the more complex interactions to come to light. This
paper indicates the differences that exist between the UK and US planning approaches; however,
in both countries, planning constraints are seen to raise price, reduce supply, increase density
and, in the UK at least, reduce choice. However, planning is also seen to provide certainty and
reduce risk. Of key interest is the price elasticity of supply of housing. Post-war estimates suggest
a value for the long-run elasticity to be between 0 and 1 for the UK, and 6 to 13 for the US