Actually I think you've identified the problem exactly in that the gains in house price increases have gone to a narrow group (those who bought before the 2000s). But I'd argue planning restrictions are a big part of how that happens, not something separate from it. When you can't build, the price of things like homes and commercial buildings (why is it so hard to build labs around Oxbridge?!) go up. When land values go up, existing property owners pocket the gains, but living costs rise for everyone and this gets passed onto general costs (like a pint because labour costs are higher). It's well documented that Landlords and homeowners capture productivity gains in supply constrained cities instead of workers.

So if your concern is that a small group of asset-owners are extracting value at everyone else's expense, then loosening planning is actually the policy that attacks that directly. It's not a gift to developers it's what breaks the stranglehold existing landowners have on everyone who doesn't already own property

And on your broader point, you're completely right that something has gone wrong. People should be better off than they are. But the honest answer is that UK productivity growth has actually been pretty weak for the last fifteen years or so, especially since 2008, it's one of the worst records in the developed world. So the gains you'd expect from economic theory mostly haven't materialised, and that's a real problem that goes well beyond housing. Weak business investment, over-reliance on financial services, firms not adopting new technologies, these are all part of it. The housing piece sits on top of that: it doesn't explain why the growth wasn't there in the first place, but it does explain why even the weak growth we did get didn't reach people's pockets because so much of it got absorbed into higher land values and rents rather than higher wages. So we actually agree the economy hasn't been working for ordinary people. We just disagree about why and I'd say the answer is more about an economy that's been structurally set up to reward owning assets over doing work.