The Future of the UK’s Housing Crisis
Late last year, the National Housing Federation released the first ever “state of the nation” report, revealing shocking figures into the UK’s housing crisis. Of these figures, the report showed that 1 in 7 people were directly affected by the housing crisis. This totals to over 8 million people throughout England living in homes that are unaffordable, unsuitable or insecure.
This report captured to true scale of the UK’s housing crisis, with people from all generations, from all over the country suffering from this crisis. Not only have these figures shown the diversity in people suffering from this crisis, it also shows how differently sufferers are affected by it, from unaffordable house and rental prices to low-quality homes, overcrowded homes and more.
The National Housing Federation has concluded through its research that the UK will need 340,000 new homes built a year, 145,000 of these being social homes.
Chief Executive of the National Housing Federation Kate Henderson has commented that this research “reveals the full enormity of the housing crisis – clearly, it is the single biggest domestic issue we face.”
Henderson further stated: “From Cornwall to Cumbria, millions of people are being pushed into debt and poverty because rent is too expensive, children can’t study because they have no space in their overcrowded homes, and many older or disabled people are struggling to move around their own home because it’s unsuitable.”
An Arguably Dated Planning System
Ashley Ilsen of Magnet Capital has also made comments regarding the UK’s current housing crisis and ways to make improvements to it, stating the following on the matter:
“I believe a key area where we can start making serious headway into solving the housing crisis is assisting the SME developer, who have traditionally struggled more when it comes to access to finance. The key is making sure that the right developer is matched with the most appropriate lender and that will always be down to the skill of the broker. The beauty of development finance is that every deal is different and there are many different ways of funding a development project.”
Ilsen further comments: “Access to finance is just one of many supply side areas that need urgent improvement if we are going to help increase the amount of new housing we are adding to the existing stock. As a specialist development finance lender we consistently hear the same complaints about a lack of quick and flexible funding and I hasten to add that there are still plenty of lenders operating in the development finance sector that don’t have the required expertise.”
“Aside from this I believe the main area where we can improve the supply of new housing stock is the current planning system. Our current planning system is arguably dated and not fit to handle the increasing demand that we need to fill for new homes. My previous conversations with government bodies about the planning system have inevitably proved to be unsuccessful and I have found that this has mainly been down to an unwillingness to change.”
“Dramatic change to the ways, and more importantly timescales, that developers are able to obtain planning would no doubt improve the current state of play and this ties in closely to how us as funders can deploy our capital. Closely linked to the planning system is the availability of land which could be used for development. As we have seen with permitted development it only takes a slightly more innovative approach to make a big difference. As with most supply side factors, the onus is on the government to help stimulate these areas to help SME builders and developers make a larger contribution to new homes in the UK.”