A Lack of House Building.

by Mark Johnston

A Lack of House Building.

Critics have claimed that this years budget lacks any real commitment to boost house building.

Dr. Neil Blake,head of EMEA and UK research at CBRE, a leading commercial property and real estate services adviser, said “what the economy needs is a new way of getting funds in to residential development, not just ownership”.

The construction industry accounts for 7 per cent of the British economy, but output fell sharply in January, down by 7.9 per cent, according to government figures.

The UK has a chronic housing supply problem and has only delivered a fraction of the 300,000 new homes that are needed each year just to meet demand.

House building is at is lowest levels since 1920s, meaning that house building barely matched demographic trends at the peak of the property boom, never mind in these depressed times.

A spokesperson for Shelter, the housing and homelessness charity, said “house building is currently at its lowest levels for almost a century. This budget was a huge missed opportunity to build enough homes to make sure our children will have a stable and affordable place of their own. Helping a small number of first time buyers today will do little to meet the aspirations of young families tomorrow”.

According to recent data the number of households is expected to grow by an average 232,000 a year in the next two decades, but just 146,420 homes were actually built in the last financial year.

The House Building Federation (HBF) figures show that between July and September last year 32,900 planning approvals were granted, which was down 10 per cent on a year ago.

All these figures demonstrate clearly why the government must stand firm and deliver a robust planning system that provides enough land to meet the nations housing needs.

Although all this said many areas of the UK have a ‘not in my back yard’ attitude when it comes to house building.

The fact is that the UK is not building enough homes that people want to live in and are affordable.

The housing market has long been weakened by the lack of new houses being built which is forcing up rental prices, thus this has left millions of people struggling to pay their rent.

 

David Orr, chief executive of the National Housing Federation (NHF), says “the danger is that if we do not tackle the fact we are still not building enough homes, we will just create another housing bubble that will continue to push house prices up and out of the reach of the majority”.

The government has therefore recognised that more help is needed and so the chancellor announced recently a £225 million investment to build at least 15,000 new affordable homes in England by 2015.

Therefore many experts have said that the new ‘help to buy’ scheme, has the potential to help a number of people in to home ownership.

Stewart Basely, executive chairman of the Housing Building Federation (HBF), has stated “building the homes we need will enable first time buyers to buy their own home and it could create around half a million new jobs, so giving the country a huge economic boost”.



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