Britain’s chronic home shortage is well publicised and the solution, touted by the government and house builders, is to build new homes. The Government is releasing its own land for development (read more in our budget article), whole new towns are being planned and high value schemes are in action, including the New Homes Bonus, to bring about the new homes that Britain so desperately needs. But why does Britain need them and are brand new homes the solution?
- Single Occupation
Whereas historically families would live under one roof, grandparents through to grandchildren, the trend today is towards single occupation. This might be put down to a mix of high divorce rates – the UK has the fourth worst rate in the world at 3.08 per 1000 people – and a cultural shift towards living on ones own and ‘flying the nest’ at the earliest available opportunity. Of course, under-occupation, accentuated by single occupation and some of the points below, is a much publicised problem, not least by us.
- Life Expectancy
People are living much longer; the UK’s life expectancy is now up to 78.2 for males and 82.4 for females. Longer lives mean more pensioners and thus greater pressure on housing provision particularly as the trend away from living with your grandparents is now so strong.
- Second Homes
Second homes across Britain lie dormant for months of the year, unoccupied when thousands of potential homeowners need to make their first steps onto the property ladder. The total stood at 246,494 in 2011, according to analysis for primelocation.com, and looks set to increase again this year.
The most recent analysis of immigration showed that a net migration into the country of around 250,000 people, the equivalent of a City the size of Wolverhampton, occurred last year, well above the Government’s target of 100,000. The figures have been attributed to fewer people leaving and an influx of Polish workers entering the country. Whatever the reason, immigration puts huge pressure on the housing supply, particularly affordable housing.
- Investment Properties
The number of buy-to-let properties rose substantially in 2011 according to the Council of Mortgage Lenders, with around 140,000 purchases in total. This puts upwards pressure on house prices, making them less affordable, whilst removing opportunities for potential homeowners to get on the ladder. The effect has been to weaken the position of potential purchasers and make homeownership less obtainable.
Although new homes are certainly the focus at the moment, many are arguing that a more sustainable, faster and more efficient solution does exist, barred only by a relentless desire for maximum profits. Read our Editor’s comment on the subject, here.