Homes in England are less affordable and in worse condition than those in most other developed nations, a new report shows.
Analysis from the Home Builders Federation reveals for the first time the full extent of the difficulties facing people in Britain trying to find somewhere to live that is decent and affordable.
Using data collated from the OECD, the European Union, and the UK Government, today’s report finds that:
- England’s severe shortage of housing has made it the most difficult place in the developed world to find a home, with the lowest rate of available properties per member of the population of all OECD nations
- England has the highest proportion of inadequate housing in Europe, with 15% of all existing homes not meeting the Decent Homes Standard and more substandard homes than Hungary, Poland and Lithuania
- The UK has some of the oldest housing stock in the developed world with only 7% of British homes built after 2001, far less than other countries like Spain, with 18.5%, and Portugal, with 16%
The report finds the UK has fallen behind its competitors in affordability, condition and housing age. Between 2004 and 2021, the UK’s rate of home ownership fell by 6% from 71% to 65%. Over the same period, levels of home ownership grew by nearly 10% in France and by 15% in the Netherlands.
Despite manifesto commitments and repeated promises to boost numbers, the policy environment has slowed the delivery of new homes. The UK remains way off delivering the government’s target of 300,000 new homes per year by the mid-2020s, with only 233,000 new homes completed in 2021-22 and delivery in the first half of 2023 down by 10%.
Analysis shows that building 320,000 homes per year would be required for England to provide homes for its population in line with the benchmark for developed nations worldwide, the OECD. 291,000 new homes would need to be built every year until 2030 to reach the level of homes enjoyed by Belgium and 390,000 homes per year to be comparable to Denmark.
At a time when we desperately need to be building more homes, the impact of the faltering economy on people’s ability to buy and an increasingly anti-development approach to housing policy are resulting in supply falling sharply. Planning consents, a strong indicator of what will be built in the coming years, fell by 19% during the first six months of 2023 as compared to the same period last year.
Lack of affordability
When it comes to affordability, the average price of a property in England and Wales is more than eight times the average salary, making them highly unaffordable places to live. The data also shows that one in five people in Britain spend more than 40% of their post-tax income on housing. This amounts to 13.3 million people – more than anywhere else in Europe.
Even when looking at countries with similar reputations for unaffordable housing, the UK compares poorly, the analysis finds. Denmark has one of the world’s most expensive and competitive property markets, where the house prices to income ratio between 2004 and 2021 grew by 12%. However, this pales in comparison to England and Wales, where the ratio has grown by 37% over the same period.
Ageing housing stock
The UK has some of the oldest housing stock in the developed world. Even despite historically high levels of housebuilding over the past decade, only 7% of British homes were built after 2001, far less than other countries like Spain with 18.5% and Portugal with 16%.
Even countries with smaller economies in Eastern Europe perform better than the UK. Hungary, for example, has one of the lowest average annual incomes in Europe and a GDP 17 times smaller than the UK, yet Hungarian houses are much more modern than British ones, with half built after 1971, compared to only a third of the UK’s housing stock.
Poor condition
Unsurprisingly perhaps given the older housing stock, homes in England are also in much poorer condition than in other developed countries.
As of 2020, England had the highest proportion of inadequate housing in Europe, with 15% of all homes not meeting the Decent Homes Standard, a measure set by the government which requires homes to be in a reasonable state of repair with reasonably modern facilities and services.
This means homes in England are in much worse condition than in Eastern European nations, including Lithuania where 11% of homes are substandard, and Poland where only 6% do not reach the required standard.
Stewart Baseley, executive chairman of the Home Builders Federation, said: “It is widely acknowledged that Britain’s housing is in crisis, but this research shows just how badly we are falling behind our international peers.”
“Decades of housing undersupply has produced startling consequences for people up and down the country looking for a decent home.”
“Housebuilders want to be able to deliver new, high-quality, energy-efficient homes which will help solve our country’s housing crisis, and they expanded investment over the past decade. Sadly, developers are still too often hampered by a restrictive planning system, an anti-development mindset and short-term politics trumping the needs of communities.”
“The country is in dire need of more high-quality and energy-efficient new homes. With an election looming and manifestos being considered, today’s research should act as a wake-up call, demonstrating the urgent need to act now to prevent us falling even further behind.”
