Are we building more yet?

It’s the first full week back to work for the re-appointed Housing Minister, and a host of official figures have been released. They paint a mixed picture – so here’s our take on what the latest stats mean for the new government.

Firstly, there were jubilant exclamations from estate agents predicting rising house prices immediately after the election. There’s no need for guesswork now though, because official figures show that house prices in March were up 1.5% across the UK, making the average price of a home £273,000 almost 10% pricier than a year ago. In other words, there is no sign of the chronic affordability crisis abating any time soon, meaning increasing numbers are being locked out of home ownership and find themselves stuck renting privately. The new Government must start thinking seriously about how it can give people a chance to have “a home of your own” – and that means building far more homes.

On this front, the figures are, at first glance, a bit more positive. In the run up to the general election there were all sorts of rumours that planning permissions had been practically halted. But in fact new housing registrations have indicated that house building is on the rise which has been mirrored in the official house building statistics out today:

  • There were 34,040 homes built between January- March 2015 (seasonally adjusted) – 10% higher than the previous quarter and 21% higher than the year before
  • There were 40,300 homes starting to be built between January- March 2015 (seasonally adjusted) and 140,500 in the financial year 2014-15 – that’s 31% higher than the last quarter and the highest level since the financial crash.

This sounds encouraging, but the sad truth is that house building has been so low for so long that we still have a long way to go: at 125,110 new homes built in England in the last year we’re only building half the minimum of 250,000 homes needed each year.

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Even more worrying, homes built by local authorities and housing associations total 28,040 for the year, just 22% of the 125,000 needed in this sector. These include social homes for rent, affordable rented homes, shared ownership homes and intermediate housing. Despite higher levels of housing association homes being built and started, we still need much higher levels of all types of affordable housing.

Housing was a high priority for people in the run up to the General Election, and increasing numbers of people (from all age groups) now support building more homes. Voters now expect the government to honour the pledges made in the election campaign and increase supply. Without action now the situation is only going to get worse for those already suffering the effects of the shortage – which will start affecting more and more people across the country as the affordability crisis deepens.

We’ve identified the steps needed to fix the housing crisis. It’s now up to the government to take action, tackle this crisis head on and help millions of people now and in the future.

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