Imperfect information about opportunities available regarding house shifting also contributes to prevent equilibrium from restoration. These factors result in the existence of trade frictions in the housing market and associated sub-markets. Hence the market powers remain unable to get restored at equilibrium level and there always remain excess supply or excess demand in the market (Tu, 2003). It becomes more difficult to restore equilibrium in all the sub-markets simultaneously. Another factor that is extremely important and serves to be a basic hindrance in the restoration of equilibrium is that people find it extremely difficult for them to move from one house to another. There are both psychological and financial concerns that determine hesitant behaviour of people regarding shifting to another house. Moreover, as people prefer to live near their friends and family they often ignore many benefits that are associated with their act of moving from one house to another (O’Sullivan, 2008).
In this section planning constraints that are present in policies of respective authorities will be discussed. Moreover, issues related to prevailing industry environment and NIMBYSM will be discussed.
It has been observed that major planning constraint that exists in United Kingdom is time lag that is involved in the permission application and time it is granted, regarding house building. Another important and long existing factor that is prevailing in that housing market of United Kingdom is that containment are imposed on the towns and cities that are already build. In some areas authorities strongly oppose to build new houses in some particular areas (Barker 2004, 2006).
Limitations of Planning System
Major limitation that can easily be judged by keeping in view the housing sector of United Kingdom is the time lag that lies between request for the permission of house building and the time when it is actually granted. Moreover the hidden intentions of government to limit the scope of development of rural areas are also another limitation.