Price chart of land in UK

Dear Mr Tan
I notice that many Singaporeans seem to fail to grasp the problem with land banking. The argument is always that land increase in price and since you own the land you cannot lose.

I have created this chart to explain my case. This is based on real land banking company data. I used a starting plot price of 10,000 UKP in 2006 converted into S$.

The green belt land value is based on land registry data in 2006 The value with planning permission is based on a land banking company estimate of 250% returns adjust by the recent fall in property prices.

I have adjust all prices using both currency and the recent boom and bust in the UK property market. I have made an assupmtion of 5% per annum increase in the value of land from 2011 forward.

Since there are no recorded successes with UK land banking plots I cannot see how any company can make claims for expercted, estimated or anticipated returns on this investment.

You will note according to this graph that in real terms land banking plots have got cheaper since 2006 as the UK currency declined in value. However many land banking companies have increased their UK pound price of their plots so that they still get the same number of Singapore dollars. As an example X increased their plot price from 5600 Pounds to 8000 Pounds in 2008.