Homeownership has hogged the headlines once again, having plunged to its lowest rate for 30 years. While London continues to dominate the debate, Greater Manchester, South and West Yorkshire and the West Midlands Metropolitan area have seen double digit falls since their early 2000s peak, according to a new Resolution Foundation analysis.
“The research by the Resolution Foundation highlights yet again that the UK is in the depths of a housing crisis,” said Terrie Alafat, Chief Executive of the Chartered Institute of Housing. “The failure to build enough new homes is at the heart of this crisis. We need 200,000 new homes to meet new need and closer to 250,000 to meet the backlog – we are currently nowhere near this level of building.
“We support the government’s ambition to build one million new homes by 2020 but its focus must now turn to providing homes offered for both ownership and rent that people can afford.”
However, according to some developers, the report places too much emphasis on ownership at all costs; there is a lack in supply of quality rented accommodation, particularly in Britain’s major cities. Perhaps the government should instead focus on attracting new institutional investment into the private rented sector, building more homes for rent where they are sorely needed.
The fall in home ownership has corresponded with a near doubling in the proportion of private renters across England, up from 11% in 2003 to 19% in 2015. The proportion of households renting privately in Greater Manchester has more than trebled over that period – from 6% to 20% – while Outer London and West Yorkshire have also reported double digit growth.
“One of the key things missing from today’s debate is even the tiniest acceptance that saddling young people with debt and pushing people into ownership at all costs may not be the most appropriate thing to do,” Tony Brooks, joint managing director at Moda Living, said. “It’s fantastic that the government’s various schemes have helped around 300,000 people get on the housing ladder, but what we fundamentally lack is a supply of quality rented accommodation suitable for people who can afford to pay market rents.
“Everyone accepts the need for more affordable housing – and policies like the extension of right to buy do nothing to help this. But in a society where Netflix, Spotify, Zip Car and Uber have created an ‘asset-light’ economy, we shouldn’t disparage people simply because they do not own a house.
“Today’s research highlights an important issue but to ensure city centre economies can thrive, we have to have a functioning rental market offering flexibility and a level of convenience that fits with the way people now live.
“Insisting that everyone own, with all the hassle and debt that comes saddled with it, is frankly irresponsible. What we should have is a balance of tenures, ensuring those most at need have costs subsidised and that those who want to pay to live centrally can do so without taking risks in what is currently a highly inconsistent private rented sector.”
PICTURE CREDIT: Mark Moz