Published: 21 Nov 2016 by John Bibby

Affordable house building fell by more than half last year, the 2015/16 statistics show. But if that wasn’t bad enough, things get even worse when you dig down into the detail and look at how this affects different parts of the country. These five maps below should help you get a comprehensive grip of quite how terrible 2015/16 was for affordable house building.

Total slump in affordable house building

The headline news – a 52% reduction in new affordable homes being built in just a year – is bad. But how it has played out across the country is very, very bad.

The map below shows the geographic distribution of the change between last year and the year before. With a quick glance you can see that across London, at the epicentre of the country’s affordable housing crisis, the number of new affordable homes built has tumbled.

But it’s not just London. In the country’s other two largest urban centres, Greater Manchester and Birmingham, there have been sharp declines too. The same trend holds for the South West, another area that has struggled to keep pace with the need for affordable housing.

In fact, looking at the areas that have the highest rates of families living in temporary accommodation shows a worrying relationship in a number of other hot spots across the country, including Peterborough, Bristol and Milton Keynes.

Affordable housing is not only built for homeless households and low income renters, though. Also included are affordable home ownership products, like shared ownership, which help people on middle incomes escape high rents and insecurity in the private rented sector. The number of these homes built has also slumped from almost 16,000 to just over 7,500. Again, the areas that have seen the biggest reductions in affordable house building are some of the places with the least affordable housing.

Social housing: going, going gone?

But we’re most worried about the continuing collapse in social rented house building. Social rented homes are normally the most affordable homes for people living on low incomes (you can watch a video explaining more about them here). We have written before about how changes to the grant regime have led to a steep decline in how many social rented homes are being built.

That trend has continued.

Last year only 6,550 were built, compared to over 40,000 a year in the early ’90s. In large parts of the country – again, including some of our big urban centres – no social rented homes were built at all.

This slide in the number of social rented homes completed last year may be historically stark, but it holds nothing to quite how bad things look set to get in future years. That’s because barely any social rented homes at all were started last year (and, barring alchemy, unless homes are started they don’t get finished).

The new stats also include figures of the number of social rented homes that were started as part of a Homes and Communities Agency (HCA) or Greater London Authority (GLA) programme. Of these only 950 social rented homes were started last year. If they were divided across council districts equally that wouldn’t even be enough for three each. But of course they weren’t divided equally, so in 292 of the 326 districts in England (AKA 90%) not a single social rented home started to be built last year.

Other social rented homes may have been started over that time period, using other funding sources (like affordable housing planning obligations through Section 106 agreements). And we know, for example, that housing associations started more than 3,500 homes last year outside the programme. But historically speaking, it is still a vanishingly small number.

Affordable Rent housing has in recent years replaced the social rented housing as the main type of sub-market rented home being built, so has to an extent picked up some of the drop off in social rented house building. But there are two big problems with simply discounting the collapse of social house building as the expected effect of a switch to Affordable Rent:

1. Many Affordable Rent homes are – despite their name – not as affordable for people on low incomes as they tend to be let at higher rents. They can be up to 80% of market rents and some have been criticised for being astronomically expensive
2. After an initial surge in the number of Affordable Rent homes being built, they too saw a collapse in the number both completed and started last year

What next?

Last year’s shocking output of homes has been blamed on the transition between one year of grant funding and the next – a dip. It’s also certainly true to say that we are not yet seeing the benefits of the welcome increase in the amount of funding that there is for affordable housing, made in the Comprehensive Spending Review last year. But you would have to be very complacent to be untroubled.

The number of homes started last year was actually lower than the number completed, so any hope of a rapid rebound seems optimistic. In any case, we are in the pit of a full-blown housing affordability crisis and don’t have the luxury of hanging around to see if rosier times wait just around the corner.

One thing is for certain, when it comes to this week’s Autumn Statement, the Chancellor is likely to be looking at these results very closely.

***This blog was updated on 22nd November to reflect the fact that the social housing starts figure only relates to homes funded by the HCA/GLA***