Council housing is back: local authority units are on the rise

If you were to look at a graph of housing completions over the past decade, and squint a little bit, you might see something slightly peculiar: the number of local authority houses being built in the UK is steadily rising.

Source: ONS

Local authority (or ‘council’) housing made up over 80% of all new-build product in post-war Britain, with over 170,000 units built when records began in 1949; but, over time, this dominance was eroded as private developers rose to prominence.

Source: ONS

In recent decades, housing associations have increasingly filled the gap left behind by the decline in local authority housing, comprising 19% of all new-builds on average over the past ten years. Local authority housing, in comparison, was barely a drop in the ocean, with just 280 units built in 2000.

The past few years, however, has seen a resurgence in the number of local authority housing being built in the UK. In 2019, 3,800 units were built; that’s more than the total of all council housing completed in 2000-2009.

Source: ONS

So, what’s driving this? In October 2018, then-Prime Minister Theresa May made a shock announcement at the Conservative Party Conference: the cap which had previously limited how much local authorities could borrow and invest in housing was to be scrapped.

The industry reacted with overwhelming positivity. Brian Berry, the Chief Executive of the Federation of Master Builders, said that it was “the most exciting, and potentially transformative, announcement on council housing for many years.”

Meanwhile, Melanie Leach – Chief Executive of the British Property Federation – remarked: “We urge local authorities to take advantage of this, to support new housing delivery and provide a significant boost to the social housing sector.”

And, with the Government’s ambition to build 300,000 more homes a year by the mid-2020s, this boost was sorely needed. Since the publication of the Housing White Paper in February 2017, successive Conservative governments have pledged to work towards this goal.

Most recently, in June 2019, MHCLG published their Outcome Delivery Plan, a report which set out how the promises made in 2017 would be delivered. In it, the Government committed to supporting local authorities to increase the supply of affordable homes via the Affordable Homes Programme; a pledge which was boosted in the March 2020 Budget, with an additional £9.5bn being announced to support 180,000 new homes, and help those who dream of taking that elusive first step on the property ladder.

Council housing often has a poor reputation. But, with the shackles lifted, Local Authorities are now increasingly investing in their housing stock. The focus now must be on ensuring they are high quality, deliverable and affordable, to ensure that this stock does not eventually become a burden.

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