17:33 PM, 3rd November 2011, About 10 years ago 1
The building of new homes has slumped to the lowest level ever – running at half the number needed to keep up with demand.
The latest government figures revealed 120,000 new homes were built in England last year.
Although London has the most resilient housing market, the capital saw the largest drop in the number of new homes started – down 27% on the year before. Around 18,000 new homes were built in London in the year.
The figures highlighted the UK has a deficit of around a million homes, with the figure rising by around 100,000 properties a year.
The number of available homes is squeezed at both ends – while fewer new homes are being built, more people are living longer – and in many cases are single occupiers in homes for families.
The main reasons for the shortfall are blamed on a muddle over government planning policies and the lack of available mortgage funding, especially for first time buyers.
The Communities and Local Government Department figures showed the number of new homes built in the 12 months to April totaled 117,700 – a fall of 6% behind a 23% slump in new housing stock between 2008 and 2010.
In 2007-08, 207,000 new houses were started, falling to 157,000 in 2008-09 and 124,000 last year.
These are the lowest house building figures in nearly 90 years – records started in 1923.
“We were not building enough homes even in the good times and the recession has exacerbated the problem. Young people are finding it next to impossible to get on to the housing ladder and there is a very real risk that even when the economy recovers under-supply will push property prices further out of the reach of many people,” said Clive Betts, chairman of the Department for Communities Select Committee.
Housing minister Grant Shapps promises a new strategy is being developed to reverse the housebuilding trend.
“We will shortly publish a housing strategy outlining both the measures we’re already taking and some new moves we’ll make to get Britain building again,” he said. “These include ensuring that for the first time people see the benefits of growth in their area through the New Homes Bonus, which matches the council tax raised on new properties for six years.”
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