‘Lost decade’ of building means England now 1 million homes short
An average of just 115,000 new homes have been built since a major housing report warned a decade ago that at least 210,000 new homes a year would need to be built in England, to prevent a worsening housing crisis.
According to the author of the original government-commissioned report, Kate Barker, it means that the country is now one million homes short of what was needed to adequately house its growing population – now equal to the number of homes in Birmingham.
Barkers latest report for the Home Builders Federation reveals that reducing the long term trend and gradually pricing households back into the market will now require 260,000 private housing starts per year. This amount is 3 times the number of new builds completed last year and a figure achieved in only 4 years since World War II. And even achieving the least ambitious of Barker’s three objectives, to slow down the rate at which households are priced out of the market, would require more than 200,000 private starts per year – a figure last achieved in 1973.
Back in December 2013 an LRS member posted a popular discussion topic within the LRS Community Forum : We will need to build 200 houses a day for the next 20 years or so simply for new immigrants.
It also brought to light the utter scandal of the amount of empty homes in the UK;
“We estimate that there are 920,000 empty homes across the UK, 330,000 of which are long term empty.”
Shadow Housing minister Emma Reynolds has recently said that the Homes and Community Agency rules, which were brought in in 2008 by Labour but abolished in 2010 by the coalition government, would be reintroduced by a future Labour government as part of a bid to tackle low levels of training in the industry and boost housebuilding.
Furthermore, The Office for National Statistics have recently revealed that excluding London and the South East of England house prices were up 3.8% in the year to the end of January and that separate figures from the UK’s major banks showed that mortgage borrowing was at its highest since August 2008.
Mentioned HERE the shortage of new builds can only start to drive house prices up at some point, due to supply and demand, which appears to be the case.
However, talking to our landlord members in many areas they are finding that the quality of tenants coming through their doors are not of a standard that they believe they can take and be safely assured that the rent is going to be paid. And in some cases landlords have said that to obtain mortgages through new criteria’s has taken as long as 5 months. Some cases have even seen some Estate Agents valuers, in certain parts of the country, down-valuing properties which have been sold for up to 15% of the agreed selling price.
There definitely seems to be great confusion in the market as statistics coming from the Government indicate the ‘boom’ but our landlord members are reporting entirely the opposite;
- shortage of good quality tenants which will qualify for Rent Guarantee Insurance (RGI) and therefore these tenants would be unable to obtain mortgages to buy property in the future,
- mortgage companies taking excessively long to give mortgages, thus seeing many sale chains breaking,
- and the down-valuations of properties below 2008/2009 values.
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