Consultant report finds 2.5 million homes needed before 2031
A report by consultant Bidwells has revealed that England needs to build 550,000 new homes each year from now until 2031 to address the current housing shortage.
The paper, titled The Productivity Engine, reviews key barriers holding back productivity in the UK, and was produced in partnership with the Office for National Statistics.
Bidwells places the majority of the blame for the lack of new housing on the planning system, as well as a decline in government funding for social housing.
These factors – amongst others – have resulted in the average age of a first time buyer rising from 26 in 1980 to 34 in 2022.
However, latest figures from the Insolvency Service have shown that the construction sector continues to experience the highest level of insolvencies over the past 12 months, with more than 4,400 construction companies failing in the past year.
House prices remain flat in June
Rightmove has published its house price index for June, revealing that the average property price fell by £21 in the month to £375,110, after reaching a record high in May.
The property website also reported that the majority of buyers and sellers have continued their plans since the election was called, with the only caution being seen in the top-end of the market, with the number of sales being agreed in June rising to 6% higher than a year ago.
The firm also noted that “stubbornly high” mortgage rates continue to affect affordability, with the average 5-year fixed mortgage rate now 5.04%, compared with 4.94% in January.
Meanwhile, figures from the Office for National Statistics have revealed a 1.1% annual house price change in the year to April 2024, and a monthly rise of 0.3%, resulting in the average UK property being valued at £281,000.
Average house prices across the 12 months to April increased in England by 0.6%, Scotland by 4.5%, Wales by 0.4% and Northern Ireland by 4.0%.
Of English regions, annual house price inflation was highest in the North West, where prices increased by 3.8%. London suffered the lowest annual inflation, with a -3.9% fall over the year.
Party policies come under criticism
The Home Builders Federation (HBF) has called on the Liberal Democrats to correct “worrying inaccuracies” in their election manifesto.
In a letter to leader Ed Davey, the HBF noted that the party’s claim that “newly built homes are often energy inefficient and environmentally unfriendly” was incorrect, pointing to government data which shows that almost nine in ten new-build homes achieves an A or B energy rating.
The Liberal Democrat’s manifesto also declares that “too many new houses are built as leasehold”. Again, the HBF have pointed the party to government data showing that more than 99% of all new houses are sold as freehold.
Meanwhile, Labour has been criticised by thinktank Common Wealth for the lack of any affordable housing target for new towns in the party’s manifesto.
Last month Angela Rayner, deputy Labour leader, announced that all new developments must meet a ‘new towns code’, which includes a target to ensure 40% of homes are for affordable tenures.
However, the party’s manifesto made no mention of the target, albeit sources close to the party said that the policy remains in place.
Berkeley launches Build to Rent platform
London-based developer Berkeley Group has revealed a fall in pre-tax profit of -7.7% to the year ending 30 April 2024 when compared to the previous year, delivering profits of £557m.
The firm also announced that it is launching a Build to Rent platform, and has identified a portfolio of around 4,000 homes across 17 of its brownfield regeneration sites.
Rob Perrins, Chief Executive, said that the move was “to maximise returns in today’s market conditions”.
Jennie Daly receives CBE
Jennie Daly, Chief Executive of Taylor Wimpey, has received a CBE in the King’s Birthday Honours List.
Daly, who is also Non-Executive Director of the Home Builders Federation, has been awarded a CBE for services to business and the housing sector and for her “exceptional leadership throughout her career”. She is the first woman to lead a FTSE 100 housebuilding company in the UK.
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