Fewer young people likely to be able to buy their own home in the future

Even if the current plan to build 220,000 new homes in England each year until 2031 is fulfilled young people aged 25 to 34 will still be less able to live in their own home that they did in 2011, according to new research.

An analysis report from the Town and Country Planning Association says that currently only 54% of the number of homes needed are being built, putting pressure on prices and rents, and the housing crisis is worse in London and the wider south east where 55% of the homes required need to be located.

Even if the homes required are actually built the latest government household projections suggest that young people across the country are struggling more than ever to live independently because of the cost of housing.

The research says that the housing requirement to meet projected household formation until 2031 is actually lower than previously anticipated but this is because younger people are already finding they cannot afford to form independent households.

Housing shortages and the resultant high prices and rents mean that young people are living with parents or in house shares for longer, rather than forming a household of their own. Rising student debt levels and potential future welfare reform are likely to make their position even more difficult.

‘This research shows that, while it looks as if the projected number of needed homes has dropped, this is because many people now can't afford their own home either to rent or buy  and are living with parents or other people longer than they would like to,’ said Kate Henderson, TCPA chief executive.

‘The government needs to see this as a wakeup call. It has already fallen behind on their targets for house building, and this is now having a devastating effect on young people. More needs to be done to build the necessary number of high quality, affordable homes for people who need them,’ she added.
Starting in 2011, a minimum of 220,000 homes are needed each year to 2031 if house building is to keep up with projected household growth and even this is not enough to enable couples aged between 25 and 34  to have the same chance of living in their own home as their counterparts in 2011.

Of the new homes needed, over half, 55%, are needed in London and the surrounding area. In contrast, in the north east, the number of new households is expected to only rise by 11% over 20 years.

Professor Christine Whitehead co-author of the research and Emeritus Professor at the London School of Economics it is a major concern that young people are likely to be less well housed in 2031 than their counterparts  in 2011.

‘If house building cannot be increased at least to the projected levels other household groups will find themselves in the same boat,’ she added.

The research also shows that the government is already falling short of its targets to build new homes. Only 54% of the homes required have been built since 2011. To catch up by 2020 with the number of homes suggested by the projections we need to build over 310,000 homes a year over the next five years.

‘The government may have an ambition to build more homes but this research shows that, to provide the homes where they are needed, much more still needs to be done. Housing is part of the essential infrastructure that this country needs to prosper and on the current delivery rates, this pressing need will not be met,’ said David Cowans, chief executive of Places for People, one of the funders of the research.