Garden citiesThe reality is at last sinking in: house price inflation does not make the nation richer; it merely makes home owners rich at the expense of those who do not own their homes. It widens the gap between rich and poor, young and old, north and south – socially divisive and economically dangerous. Even those who have enjoyed seeing the value of their home increase are now beginning to worry about how their children will be able to afford a home.

But pent-up demand for more housing in the UK should be an economic opportunity not a social problem. 92 per cent of Great Britain is undeveloped. Building on just 1 per cent of this land could provide all the homes we need – well-built homes, spacious, comfortable, affordable, and with plenty of gardens and open green spaces. The right housing policies present an opportunity to improve our quality of life and create hundreds of thousands of skilled jobs – economic growth at its best.

So, what is stopping us? The answer is that we have a planning system that simply doesn’t work. Planning has overcrowded our towns and cities, overloaded our transport infrastructure, inflated land prices, underinvested in quality, restricted competition and crushed innovation. The result: Britons now live in Europe’s smallest and most expensive homes. For some reason, a system that was designed to ensure better homes for all has inexorably morphed into an economic straitjacket.

It is not surprising that local residents organise opposition campaigns when faced with low quality developments that overstretch local amenities. It is not just about fearing change: bad development often lowers the price of existing homes – for many their most valuable asset.

It need not be this way. Something has to change. Most importantly, new development does not have to take place within the bounds of our existing towns and cities.

Secondly, the economics of new development can be much improved. An acre of arable land in the South East of England is worth less than £20,000 an acre, with planning permission it is worth over £1,000,000. That gain could be invested in better quality homes, infrastructure, parks, playgrounds, and in compensating the small number who would be adversely affected by the new development.

Garden cities offer a ray of hope in what has become an increasingly sterile debate. I am delighted that this year’s Wolfson Economics Prize has produced so many exciting ideas about how we could build new cities.

David Rudlin’s brilliant top prize-winning submission imagines how around 40 existing towns and cities could be expanded and revitalised. His co-author Nicholas Falk uses Oxford as a case study, bravely suggesting that Oxford’s Green Belt may now be strangling the city rather than nourishing it.

David and his co-authors recognise that the quality of what we build is largely an economic problem not a question of design. He proposes enabling legislation to allow the vast sums currently spent on land to be invested in build quality and infrastructure. A Garden City Foundation would provide the framework for the enlarged city, and harness the collective energy and intelligence of different developers and builders to evolve the city’s new neighbourhoods. This model consciously draws on the success of our historic great urban estates – a winning combination of well-planned transport and public services, with the free market doing the rest of the work. In his new neighbourhoods, residents would be no more than 10 minutes’ walk from a tram station, each of which would provide direct access to the city centre and support a secondary school.

Interestingly, his model would also vastly increase access to surrounding countryside that is currently not open to the public. He proposes that for every acre developed, another acre of inaccessible farmland would be given back to the city as forests, lakes, market gardens and country parks.

The other four finalists offered interesting ideas too. National housing charity Shelter, who scooped the £50,000 runners up prize, proposed a city of 60,000 homes on the Hoo Peninsula, bringing much needed jobs and homes to the Medway area. Their intelligent proposal presents a plan that, in their words, “is ready to go”. It combines an ambitious vision for a harbour-fronted city with a credible investment model and a carefully researched plan for gaining local popular support.

Architects and master planners Wei Yang & Partners worked with Peter Freeman (the man behind the Kings Cross development) to propose an arc of smaller garden city locations, running from Portsmouth in the south through Oxford and Cambridge and on to Felixstowe. Planning consultants Barton Willmore cogently argue for 30 to 40 new garden cities. Chris Blundell sets out a plan for a small city south of Maidstone which would sit neatly on the High Speed rail link to the Channel Tunnel.

The response to this year’s Wolfson Economics prize has been phenomenal; over 250 entries; five exceptional submissions, and more than one blueprint that could be adopted by policy makers and turned into reality. In the run up to the next election our political leaders must set out how they plan to tackle Britain’s housing crisis. I hope they will draw on the wisdom of David Rudlin, Shelter and others. Garden Cities may not be the only answer, but they offer a real chance for all those who aspire to own their own home.