Why we are still only building half the homes we need?

Henry Gregg
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New housing starts were down 14 per cent on last year (Source: Getty)

>Today’s release of the latest figures for homebuilding by the Department for Communities and Local Government make for interesting reading for all those interested in ending our nation’s housing crisis.
Ultimately, they are a mixed bag. On a positive note, housing completions were up to 36,890 in the three months to July – the highest quarterly performance since 2008. However, simultaneously we have seen a per cent decrease in housing starts compared to the same quarter in 2014 – which, if continued over several quarters, may show signs of a worrying decline in the supply of new homes.
While this latest batch of statistics is certainly of key importance to the housing world, any analysis that purely focuses on them would fail to tackle the wider strategic challenges that face our country. Our nation’s housing challenges are far grander and more strategic.
As I see it, there are three major issues we must get to grips with.
Firstly, supply. In London, just a third of the 56,400 homes we need were completed in the second quarter. This has driven up prices to ever higher levels – with the average house in London now surpassing £500,000. In turn, that’s driving more people into rented homes, increasing rents. In London this means people are spending over half their income on rent.
The second challenge is in the provision of land. Some 94 per cent of England remains undeveloped. Brownfield land can and should be used where possible - but we estimate there only to be enough to meet our needs for the next four years.
While care must be taken for our countryside and local people’s concerns, we must think of new, better ways to use our land supply that balances this with the need for new homes.
Finally, we need to reduce red tape to free up housing associations allowing them to build the homes we desperately need.
Housing associations need greater freedoms from the government to allow them to utilise their independence and expertise to provide creative and innovative solutions to the particular pressures in their area.
The government has shown a willingness to act here, with welcome reforms to the use of public land for homes, simplifying the planning rules - and just this morning, taking action to help regenerate our villages and rural areas.
Housing was given centre stage at the recent election and with good reason. We have a crisis in housing that’s driving up rents and prices, reducing affordability and harming our nation’s productivity.
People are ready for bold action, with the proportion of people opposing local building falling from 46 per cent in 2010 to 21% in 2014. The government, working together with housing associations, can build the homes needed to end the housing crisis once and for all.

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