Building Our Homes, Communities and Future
Introduction:
Local government shares the collective ambition to building more homes, and its focus is beyond bricks and mortar. The right homes in the right areas can have significant wider benefits for people and communities, and prevent future public service challenges and costs.
House prices and rents continue to rise above incomes in ways that force difficult decisions on families, distort places, and hamper growth. It will take many years of significant housebuilding to begin reducing prices, meaning the need to build many more affordable homes is as important as ever. The Autumn Statement introduced a number of welcome measures supporting housebuilding across tenures, investing in affordable homes and infrastructure linked to housing growth. These were important asks in our preliminary findings, but there is much more to do. In advance of the Housing White Paper, this final commission report sets out recommendations for how local and national governments can work together to build more homes, and to build homes that meet the diverse needs of people, partners and places.
Housing Supply And Affordability:
There is a crisis because housing is unavailable, unaffordable, and is not appropriate for everyone that needs it. While there are a number of explanations for this, the reality is that the housing market is a complex and interconnected system, both within and with other parts of our economy and society.
Building substantially:
Building substantially many more homes than we are currently managing is this best solution to the housing crisis, and building them in appropriate locations and across a range of tenures while ensuring they are affordable, of sufficient quality and the right type. This is the primary focus of the commission, which does not investigate other factors that might contribute to high house prices, such as credit supply, taxation, and investment incentives.
Housebuilding:
Housebuilding is now a government priority with a target of one million new homes by 2020/21. The latest net supply of housing data suggests that the Government could meet its target if measured against the net change in dwellings. The data shows that housing stock in England increased by 190,000 in 2015/16, just 10,000 short of the required annual average. However, the number of new build homes completed during that period was a slightly lower than expected 164,000 homes.
Affordability:
Despite house prices rising above previous records and being unaffordable relative to earnings, the annual cost of repaying a mortgage is well within historic affordable levels thanks to record low mortgage rates. That means those households with a mortgage spend a lower proportion of their income on housing than those renting from a landlord.
Housing Tenure:
With constrained house-buying affordability and a limited supply of new homes, accessing home-ownership is a significant challenge for many prospective first time buyers. The majority of people still aspire to own their own home but the share of households owning their home peaked in 2003 at 71 per cent of households and has been in decline since.
Homes Through New Housing Vehicles:
It is recommended that local and national government work together to:
- Develop routes for councils to directly deliver new homes of all tenures through innovative delivery vehicles, including joint delivery vehicles across areas.
- Provide strong long-term certainty, backing, additional capacity support, powers and good practice support for councils looking to increase their level of direct delivery of new homes.
Conclusion:
There is a significant and increasing demand for affordable housing from low and middle income families. However, with the current housing policies it is highly likely that social housing will continue to be focused on those people who are more likely to struggle in the jobs market. Our aspirations for workless social housing tenants should be to help them find work, improve their skills, increase earnings and, ultimately, enable them to have a choice of housing tenure.