With a month to go before the Government unveils its tax and spending plans in the next Budget on 11th March, it has been urged to significantly raise investment in housebuilding, in order to stem the UK’s housing crisis over the next decade, by the National Housing Federation (NHF).
Releasing new research, the NHF has joined a coalition of housing groups and charities all calling on the Government to end the housing crisis, by investing as much as £12.8 billion annually in building more housing.
This coalition, which includes the charities Shelter, Crisis, CPRE and the Chartered Institute of Housing, believes that investments in the suggested amounts over the coming years would take spending back to levels last seen in the early-1950s, when a ready supply of homes were built to match demand.
Stimulus required to solve the crisis
The coalition of charities and housing groups estimated that increased housebuilding investment should total as much as £146 billion by 2031, provided that the government starts to boost spending from 2021 onwards.
This would help deliver as many as 1.45 million social homes to rent and shared ownership properties available for purchase in the next decade, according to the NHF.
For a number of years, the population has been growing but housebuilding has failed to meet demand.
In its most recent housebuilding data, the Government claimed 39,510 new dwelling starts had been made in the third quarter of 2019, a two per cent increase on the second quarter, but 11 per cent lower than the same period in 2018.
On an annualised basis, 177,980 completions were made between September 2018 and September 2019, representing growth of nine per cent.
Despite a marked rise in housebuilding activity in 2019, the Office for National Statistics estimated that the UK population grew by approximately 400,000 people last year, based on its own population projections, indicating the underlying pressure being exerted on the housing market at present.
Housebuilding suffers from “chronic under-investment”
Over the last year, the Government spent £1.27 billion on delivering new affordable homes, meaning the housing budget had been slashed by as much as 70 per cent when compared to 2010 spending levels.
As a result, social homes were being built at a rate of just 5,400 in 2017-18, compared to 36,000 in 2010-11.
The NHF claimed that chronic government under-investment in housebuilding by successive governments had resulted in a 169 per cent increase in rough sleeping, with the number of UK households having to live in temporary accommodation hitting a 10-year high.
Kate Henderson, chief executive of the NHF, said: “As well as being the right thing to do, investing to end the housing crisis also carries huge economic benefits. It will advance the country’s productivity, boost its economic growth and lower the benefit bill over time.”
As many as 1.3 million children were estimated to be living in poverty while living in expensive private rented housing, while young people remained frozen out of the housing market.
Some younger people find themselves having to resort to living with close family members for the time being, unable to take the next steps towards independence and potentially starting a family of their own.
Last month, housing charity Shelter claimed that up to two million people living in the private rented sector had been made unwell as a result of housing problems, including poor living conditions.