New Build Housing Failing To Keep Up With Population Increases
The extent of the housing crisis was highlighted this week as the current housing stock and newly built properties in and around the UK’s largest cities are failing to keep up with the huge growth in population.
According to property lender Blend, who compared building data between 2011 and 2017 against the Office for National Statistics (ONS) data on population growth up to 2017 and consensus data, found that the ratio of new residents per new home are creating a clear strain on the UK’s major cities.
The lack of housing stock intertwined with rising population numbers has created the perfect storm for increased house prices and difficult market conditions for buyers in these areas overpopulated regions.
ONS data found that each household houses an average of 2.4 people. Of the 100 towns and cities reviewed in the research, over half of the local authorities are failing to build enough property to house the additional people living in the specific areas.
Belfast, the Northern Irish capital, is facing the most significant disparity between new residents and the new houses built to accommodate them. Between 2011 and 2017, the Belfast population jumped by 59,989 from 280,211 to 340,200. Despite the 21% population rise, the 4,200 newly built houses mean that there are 14.21 new residents per house.
In order to match the national average of 2.4 people per household in Belfast, 24,995 homes needed building during this time; an overall shortfall of 20,795.
Conditions in Brighton allowed property prices to increase by 49% between 2011 and 2017. Although the population only rose by 5.45% during this time, the 1,070 new homes built in this area has left the new residents fighting for property at a ratio of one new house per 13.93 residents.
The 1,620 new properties built in the Luton area resulted in the 5.65% increase of the local population has left the additional 7.1 people scrapping for each new home. It has also contributed to the average house price increasing by 68%.
Conversely, Northern English seaside towns have been dealing with an exodus of residents leaving the area. Scarborough’s official population fell by 300 residents or 0.28%. However, the additional 1,980 homes mean that there is a surplus of properties in this particular area. Similarly, Blackpool’s population decline of 1.48% has led to 530 new homes that are not desperately needed.
Although it can be a fine balancing act, local authorities need to become more adept at planning for the additional homes they need to build in order to avoid exacerbating the housing crisis further.
Yann Murciano, Chief Executive at Blend Network, said:
“That there is a housing crisis in the UK is well recognised and beyond dispute but the extent of the crisis we are facing has been laid bare by examining this data.
“What is also troubling is that we may not be building homes in the right places. There is clearly a need for greater house building in Belfast, Manchester, Coventry and Birmingham for instance, but perhaps less so in cities like Glasgow, Swansea or Sunderland.
“Given how much is made of property values in London and the link between high house prices and a lack of property, it is perhaps surprising that the data suggests there is less of a chronic under-supply of housing than would be believed.
“Obviously, property developers can only build housing where it is needed with financial support but often struggle to raise enough funds from traditional lenders.”
What impact is the lack of available housing currently having on the property market?