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Social & affordable housing at crisis levels

If there is one pivotal issue causing a crisis in the UK housing market, it is the massive drop in the provision of social and affordable housing, warns the Royal Institution of Chartered Surveyors (RICS).

Whilst building levels of private housing have continued at a steady pace over the last few decades, social and affordable housing provision has dropped massively to crisis levels. Provision of social housing is only one-fifth of what it was 20 years ago.

RICS predicts that the UK needs to build 241,000 houses per year for the next 20 years in order to meet current demand. Even with the Government's commitment to build an extra 200,000 homes over the next 20 years, with current building levels at 170,000 per year, the shortfall could be a staggering 1.2 million homes.

Based on current housing demolition rates (an average of 22,700 properties per year over the last five years) the existing housing stock will be under pressure too, with each property expected to be in use for over 1,000 years. For this reason, RICS has called upon the Chancellor to reduce the current VAT levels on refurbishment and renewal work on houses to encourage people to keep up with essential maintenance of their properties.

RICS chief executive, Louis Armstrong, says:

“We have created a housing underclass, a group of people who are unlikely to be able to find a decent home to live in. Unless we start building more affordable housing over the next two decades and look after our existing properties, the number of people excluding from the housing market is likely to swell.”

“House prices have doubled since 1995 leaving people who traditionally would have been able to purchase their own home priced out of the market with little hope of accessing decent housing.”

RICS believes the situation has arisen due to continuous erosion in public subsidy on the building of social housing, reducing incentives for house-builders.