Local authorities built 3,540 homes in the UK in 2017/18, the highest figure in 17 years, according to the latest statistics from the Ministry of Housing, Communities and Local Government. However, a total of 12,059 council homes were sold over the same period.
The MJ reported that: A total of 192,000 homes were completed in the UK in 2017/18 of which 156,000 were built by the private sector, and 32, 570 were by housing associations. The total was the highest since 2007/8 when the recession hit but still below the peak decades of the 1960s and 1970s.
We’ve previously written about the cross-party report stating that we need to build 3m new social homes by 2040. The government has been seeking to revive council housebuilding to help address the national shortage of affordable housing with a series of cash injections and by scrapping the cap on how much councils can borrow against their housing revenue account assets to fund new developments.
However, a recent report by This Is Money shows that although significant progress is being made, home ownership still represents a challenge to many in the UK, stating: To put the scale of the UK’s housing shortage into perspective, since 1970 France has built roughly twice as many new homes each year as Britain and experienced half the level of real house price growth.
Studies by the Office for National Statistics suggest that between 1997 and 2016, average annual earnings increased by only 68 per cent, while house prices skyrocketed by 259 per cent.
Thirty years ago, full-time employees in England and Wales could typically expect to spend 3.6 times their annual earnings on purchasing a house, according to ONS data.
Today, homebuyers can expect to spend 9.7 times annual earnings on purchasing a newly-built property and 7.6 times their annual earnings on an existing property.
This provides some perspective on the scale of the challenge for the government when seeking to make more affordable housing available over the coming decades.
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