Policymakers of all political parties recognise the pressing need for us to build more homes in this country. In this paper, the third in IPPR's series of briefing papers as part of its fundamental review of housing policy, we turn to a question that is vexing policymakers in government and elsewhere: 'If we are to increase housing supply, how are we to pay for it?'

The paper does not dwell on how better to use the country's existing housing stock - that will be the subject of the next paper in the series - but instead, on how we can afford to increase that stock. We concentrate on three key ideas - focused on institutional investment, the role of local authorities and recapitalising public spending in housing - as well as additional proposals around expanding the nascent Green Investment Bank into a true National Investment Bank and reform of the development industry.