In the last seven years that the Conservatives have been in power, they have managed to build over 1.1 million new homes with a yearly average of 158,759. Despite a recent increase in the number of new dwellings built, the rate of house building is not quick enough to satisfy the demand within the UK’s housing market, leading to a crisis.
The UK Government recently released the housing figures for the 2016/17 financial year and the country saw the highest rates of house building since the 2008 recession, which seriously slowed up the UK’s house building. Since the recession, the highest rate of house building had been the year 2015/16, in which 163,940 new dwellings were built, however this was eclipsed in the latest figures, with 183,570 new dwellings having been built in 2016/17.
The number of conversions and the change of use of buildings was not taken into account in the figures above, nor were the number of demolitions taken into account. When all of these other figures are taken into account, there were 189,650 net new dwellings in the year 2015/16 while the latest figures for the 16/17 year showed that net new dwellings had increased to 217,350 – That’s a big increase in pile foundations.
Of the 183,570 new dwellings that were built, the highest rates of new house building has been seen across the south of the country, with Cornwall, Devon and Gloucestershire seeing the highest net additional dwellings. High rates were also seen just outside of London’s ‘Green Belt’ in areas like Buckinghamshire, Bedfordshire, Oxfordshire, Northamptonshire, Cambridgeshire and Norfolk.
Parts of the north of the UK were on the other end of the house building spectrum, as places like Blackpool, Barron-in-Furness and Wirral saw the lowest net additional dwellings. The lack of house building in these areas has made a bad situation worse for those seeking properties in these locations and the Government will need to encourage house builders to start building in these locations.
House builders will often allow potential customers to search on their websites for local housing developments. The biggest housing developers include the likes of Taylor Wimpey, Barratt Homes, Persimmon and Bovis. The Government’s website also allows people to search the register for planning decisions in your local area, giving potential buyers the chance to learn where new houses are likely to be built.
London is an area that is desperately in need of more housing developments, as Newham was one of the few regions of the capital to actually provide enough houses for the demand. The capital is also in need of new housing developments in order to help slow down the sky rocketing prices, as from January 1995 to September 2017, inner London average property prices have risen from around £75,000 to just under £600,000.
The Home Counties have also seen a substantial rise in the average property price, with Aylesbury Vale seeing a rise from £79,000 to £415,000 and Slough having increased from £56,000 to £357,000. In contrast, locations in the north of the country like Sheffield started 1995 with an average price of £46,000 to the current average value of £180,000. Bolton saw a similar change, starting at £46,000 in 1995 and increasing to just £162,000 on average.
Despite the rates of house building showing signs of improvement it is currently not enough to satisfy the current demand that, in particular, features people under the age of 45, with figures showing just how few people under 45 own a property. Since 1991 the number of 35-44 year older who own their own property has dropped nearly 20% from 78% to 58.8% while those in the 25-34 and 16-24 age brackets have suffered even worse. In 1991 66.5% of 25-34 year olds owned their property, while that figure has plummeted to 35.8%, whereas for the 16-24s, the figure is currently at 8.9% having previously been 36.1% in 1991.
There have been several issues in the UK housing market which has begun to lead to a housing crisis. A major problem for the UK is that there are many people on council housing lists and the Government has yet to build enough affordable properties to help alleviate the pressure. Although the increase in house prices are great for those who already own their property, for those who are trying to take their first steps on the property ladder, these prices are a stumbling block as mortgage lenders look for a 10% deposit on a property. With many people currently renting a property, it makes it difficult to save up for a deposit with the current rental prices.
One scheme that the Government brought in to help first time buyers was the Help To Buy scheme which helped over 120,000 people get onto the property ladder. Originally introduced in 2013 under the Tory-Lib Dem Coalition Government, the Help To Buy scheme will continue on until 2020, with only the Mortgage Guarantee element of the scheme being scrapped.
Prime Minister Theresa May announced that another £2 billion will be going towards funding for housing, taking the Affordable Homes Programme budget to over £9 billion. This is the first step in helping the current generation from being able to get onto the property ladder and the Government will be hoping it prevents the housing crisis from worsening.