70,000 per year can’t afford market housing
Worrying new research conducted by estate agents Savills suggests that in every year for the next five years, 70,000 new households in England will be unable to afford to buy or rent market housing, unless they are assisted.
This indicates that 350,000 households will require some kind of sub-market housing by 2020.
Targets
According to the report, owner occupation remains the tenure of choice for the majority of people. The Government has given a target of delivering 200,000 new homes a year over the course of the current Parliament, with an ultimate goal of reversing the decline in home ownership.
Savills warns however that a consequence of this plan could be a fall in affordable housing numbers for the very lowest income households.
Data from the report analyses the cost of buying or renting a home in the current market and assumes 30% of gross household income is spent on housing. Taking this into account, at least 70,000 new low-to-middle income households per year will be unable to live in market housing.
The agency claims that the nature of households that are unable to access market housing varies hugely across the country, with the problem at its worse in London and the South East.
70,000 per year can’t afford market housing
London falling
In London, there are concerns that households that earn an average income of 60,00 per annum and still not be able to afford market housing.
Chris Buckle of Savills’ research team, said that, ‘there can be no question that we need to boost housebuilding volumes, but these new homes need to be built across a variety of tenures to put homes within reach of those in greatest need.’[1]
‘Our concern is that new policy will result in a greater shift from sub-market rental products towards more expensive shared ownership and Starter Homes accessible only to those on middle incomes,’ he added.[1]
[1] https://www.estateagenttoday.co.uk/breaking-news/2015/11/70-000-new-households-a-year-cant-afford-to-buy-or-rent-says-agency