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Significant issues ‘holding back construction’ of much needed new homes

The increase in demand for residential properties, coupled with restricted supply of new homes being built, will almost certainly cause property prices and rents to increase over the next few years, fresh research suggests.

The number of new build homes that have started to be built has increased over the past 12 months, but the government looks set to fail in its aim to build the 300,000 new homes per year deemed necessarily by the mid-2020s, placing upward pressure on house prices and rents.

A survey of more than 400 housebuilding companies in England, carried out for construction consulting and design agency, McBains, found that more than half of developers - 57% - have increased the rate at which they have built new homes over last year and predict a further rise over the next 12 months, but they are not developing anywhere near the level of new homes needed to meet growing housing demand.


Overall, housebuilders said they had built, on average, 201 homes over the last year. This was expected to rise to 297 over the next 12 months.

But respondents to the survey cited worries over land availability, slow planning permission and skills shortages as barriers to preventing them building more homes, with almost half - 48% - identifying these factors as making it difficult for the government to meet its target of 300,000 homes a year on average by the mid-2020s.

Of the homes to be built over the next 12 months, housebuilders expected one in five - 22% - of these new homes to be classed as affordable homes for rent or sale.

Clive Docwra, managing director of McBains, commented: “The survey is encouraging in that housebuilders are increasing the rate at which they are building homes.

“However, issues such as a lack of appropriate land, slow planning permission and skills shortages remain significant factors holding back construction, which is why the majority of respondents are sceptical that the government’s housing targets will be met.

“In particular, the construction industry relies on thousands of skilled EU workers because of skills shortages in the domestic workforce, and with these workers potentially prevented from working in the UK after the Brexit transition period ends in 2021, many housebuilders will be struggling to find the workforce needed to build the new homes that are urgently needed.

“And for those people struggling to get a foot on the property ladder, the finding that only around one in five of new homes to be built over the next year will fall into the affordable category will be disappointing.”

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Poll: Do you think the government will achieve its goal of delivering 300,000 new homes per year by the mid-2020s?


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    • 27 February 2019 23:36 PM

    It doesn't really matter how many houses are built.
    Those that would qualify to buy can't afford to do so.
    If any are social housing then no aspirant FTB will be given social housing.
    It is hard to see how FTB will be in a position to buy.
    While the ridiculous MMR exist then very few will be able to buy.
    Such properties will be bought by downsizers or LL.
    Only if HTB is still around will FTB stand a chance of buying these properties.
    The facts are that especially in the SE wages are too low and the deposits required massive for any FTB to buy.
    There is also the issue of MMR preventing IO mortgages.
    FTB need to be offered IO mortgages until age 90.
    That is the only way a property will be remotely affordable in the SE.
    I see no problem in inter- generational mortgages being introduced.
    Govt though would have to stop IHT on an estate which invariably means a property has to be sold to pay the IHT.
    Govt is also relying on being able to rob the asset values of residential property to pay for care fees.
    Govt will not want homeowners in permanent mortgage debt as there would be less equity to rob.
    Govt doesn't seem minded to change any of these barriers to homeownership.
    With continuing mass uncontrolled immigration along with organic growth I can't see where everyone is supposed to live!!!


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