Housing in England: Overview

Wednesday 25 January 2017

The National Audit Office has released their findings from Housing in England: overview which claim that the need for housing in England has in recent years grown faster than its supply.

The report finds that housebuilding has not kept pace with need, a problem that is particularly prevalent in London.

The total number of homes in England stood at 23.5 million in 2005 with an estimated cost of £5.6 trillion.

Of these 23.5 million, 62% are owner-occupied, 20% are privately rented and 17% are socially rented.

For existing homeowners, housing has become more affordable, with the proportion of owner-occupiers who spend at least a quarter of their disposable income on housing falling from 40% to 19% of people with a mortgage.

By contrast however, housing has become less affordable for first-time buyers. The cost of borrowing has risen from 2.3 times the average income in 2000 to 3.2 times income in 2014. First-time buyers now also put down an average deposit of 21% compared with 13% in 1990. 

Homelessness has also increased over the past five years. At the end of March 2016, 71,500 homeless households in England were in temporary accommodation, up from around 48,000 in 2010-11.

A new Government Bill which is currently at Report stage in the House of Commons aims to tackle homelessness and will be given a £48 million injection of funds if passed by Parliament, to help councils deliver new and expanded services to prevent and reduce homelessness. 

Amyas Morse, head of the National Audit Office said:

“The need for housing in England has in recent years grown faster than its supply, and housebuilding needs to increase across the country. The government has responded to this by putting in place a range of policies to increase housing supply and home ownership. Central to this is an ambition to increase the supply of housing by one million homes by 2020, largely through support to private housebuilders. Delivery of this target will not require a substantial increase in current levels of housebuilding.”

The government’s set objective is to deliver a million new homes by 2020 which will require 174,000 net additions each year. As the country awaits the release of the Housing White Paper, it is still not yet clear what impact the result of the referendum on Britain’s membership of the European Union will have on the market.