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Buy to let is likely to ride high for several years to come as the government reports house building in England is at the lowest level for a decade after falling nearly 23% in just 12 months.
The sorry figures reveal that fewer homes were built in every region – down 37,890 properties from 166,570 to 128,680 net new homes in 2009-10.
Even if buyers could raise mortgages, the likelihood is the market will have a shortage of homes for sale because trading existing homes does not satisfy the demand for more properties.
The lowest figure was only 3,470 net new homes added to the housing stock in northeast during the year.
The number of net new homes is the total of new build, conversions and change of use properties less demolitions.
The highest net new home figures were returned in London (24,340) and the southeast (22,080).
The statistics, released by the Communities and Local Government department, show a steady rise in house building from 2000 to a peak in 2007 of 207,370 net new homes.
The figures slumped by 20% in 2008 and now 23% in 2009 – representing a drop of about 38% from the top of the housing market in 2007.
This year is the lowest net new homes figure since records began in 2000-01, which showed 132,000 net new homes.
The government has indicated a target of building 150,000 in the next four years, which seems to be a lofty ambition in the current economic climate.
Liz Peace, chief executive of the British Property Federation, said:
“If the Government really wants its ideas to fly it needs to consider amendments to planning policy, so that there is greater flexibility over affordable housing requirements, and restoring direct payment to private sector landlords.
“Delivering 150,000 new homes in the current climate will be challenging, but might be possible with these sorts of reforms.”
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