Building 180,000 homes is unachievable
New research has indicated that a vast number of UK housebuilders believe that building in excess of 180,000 properties per annum is remotely unachievable.
A report from Knight Frank suggests that 67% of housebuilders feel that the absolute maximum number of homes that can currently be delivered are 180,000 or less. Only 9% of respondents said that building 200,000 or more homes per year is currently achievable.[1
More than 50% of housing developers felt that an increase in the number of affordable homes during the next twelve months was unlikely. 60% however said that they expect a steady rise in the total number of housing starts and completions during the next year.[2]
Price increase
In line with housing prices in general, 78% of respondents feel that new-build property prices will rise in the coming months, with 43% expecting a rise of 5%.[3]
However, 91% said that they felt pressure on housebuilders would rise with increased construction costs. 59% felt that these costs could rise between 5-10% as early as this year. 68% also expected Greenfield land prices to rise.[4]
Policies
The survey from Knight Frank also asked housebuilders about what policies they felt could be introduced in order to secure long-term housing provision in the United Kingdom. 82% replied that improving resources for local planning departments would be most effective, with 58% believing that further training within the industry would help. 57% said that more access to public land would also assist with the issue.[5]
Building 180,000 homes is unachievable
Head of Knight Frank UK Residential Research Grainne Gilmore said that, ‘in the run-up to the election, all political parties agree that the delivery of more new homes is a priority.’ Gilmore suggests that, ‘policymakers, especially those in power after the election, may want to heed the calls from housebuilders to beef up planning departments in local authorities, plough more investment into skills and training in the construction sector and provide better access to public sector land’[6]
Justin Gaze, Joint Head of Residential Development at Knight Frank, also commented,’ the capacity to deliver the sheer number of new homes required is the fundamental issue faced by the UK’s housebuilders.’ Gaze believes that, ‘the inability to create the necessary number of new homes is being driven primarily by a skills shortage in the development sector which shrunk dramatically following the financial crisis.’[7]
[1-7] http://www.propertyreporter.co.uk/property/is-180000-new-homes-a-year-achievable.html