Big promises were made by Prime Minister Theresa May that she will make housing her top priority, but so far no major progress has been in this direction. Britain’s housebuilding sector has shrunk at its sharpest pace on record from the start according to official figures. It has contributed to a bigger-than-expected decline for the wider construction sector, which contracted by 3.4% - the largest since June 2012. This will be set-back to the expectation of ministers seeking to boost the number of homes. Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: "Rising interest rates and Brexit uncertainty are proving to be a toxic combination for the construction sector."
The demise of the construction company Carillion could have affected the decrease in house-building figures. It is really discouraging to see promises made by the government to increase housing stock are being broken whereas the demand is rising, especially for affordable and social housing. The country is in the grip of a housing shortage, and the end result is soaring rents, poor conditions and rising homelessness. For decades successive governments have failed to build homes that were needed. By 2008 building of new homes had fallen to its lowest peacetime level since 1924 and house building has barely recovered since then.
Britain simply has not built enough houses to meet rising demand. The rate of new-home construction is around 150,000 a year, the lowest since the 1920s. But annual demand for new residences is an estimated 250,000. The laws of supply and demand dictate rising prices. Building more houses by whatever means – giving councils bigger development budgets, easing planning restrictions, allowing housing associations to borrow, imposing a land value tax, etc. – will increase supply and reduce prices, removing many of the symptoms of our housing nightmare. It is time for action and not empty promises.
Baldev Sharma
Rayners Lane, Harrow
