Housebuilding is set to rise by 55 per cent over
the next five years, according to research published this
week by property consultants Savills. By 2018 they expect
output to have risen to 167,000 homes a year, a big increase on
current numbers, but still well short of the 240,000 homes needed
to meet demand. And this, admittedly, is an optimistic forecast.
Susan Emmett, director of residential research at Savills, said:
'We have made some robust assumptions about increase, but it's
worrying that even a best-case scenario is still not good enough to
meet housing need.'
The forecast assumes that private sector output will rise
incrementally by 8 per cent a year as the economic recovery takes
hold, to yield an average of 107,000 homes a year over the five
year period. However, even by 2018 the number of homes built will
fall well short of the 154,000 completed in 2007.
Housing associations are assumed to deliver the 2011-15 HCA
programme, completing 26,000 homes in 2014 and 34,000 in 2015.
Completions are assumed to continue at around 34,000 a year to
2018. Council house building is assumed to grow steadily to 10,000
homes a year by 2018, although detailed reasons for this prediction
are not given.
As Savills point out, this is a best case scenario on the basis
of current policies. It provides some useful pointers as to where
Government should focus action to raise output closer to what is
needed. Best estimates suggest that around a third of the 240,000
homes required national should for sub-market rent.
With housing association output focussed on 'affordable' rented
housing, it will be up to councils to meet the demand for housing
at social rents which are affordable by those on the lowest
incomes, particularly in areas where the gap between market and
social rents is wide. If the overall aspiration is 80,000 homes a
year from councils and housing associations together, output needs
to more than double the expected 2014 total of less than 30,000
Further action is also needed if private sector output is to
grow to 160,000 homes a year, but this represents only a 20 per
cent increase on Savills' prediction for 2018. The debate on
whether Help to Buy will push up house prices or raise output is
important, but it should not distract attention from the need for
urgent action to stimulate the construction of more social