The UK simply can’t build enough homes

The UK simply can’t build enough homes

Have you ever wondered why the UK is in the grips of such a housing crisis?

It’s a stark fact that nowhere near enough homes are being built to meet demand and with average house prices now starting to exceed £200K, first-time buyers can’t get a look in. This has led to huge growth in the buy-to-let market and in some parts of the UK, rental rates are soaring.

So how did we get here?

There are many reasons for this and the financial crash of 2007/08 was certainly a big catalyst for the situation we now find ourselves in. As a result of the crash, banks simply stopped lending money and buyers couldn’t get the mortgages they needed. The knock-on effect of this is that builders couldn’t sell so many houses and, as a consequence, fewer houses were built. To exacerbate problems further, approximately a quarter of million people left the construction industry during the recession and now that the demand has returned, there is a massive skills shortage to be filled. The problem is also compounded by major developers who have acquired land but have not built on it yet because they are waiting for a surge on house prices so that they can get the best return on investment possible.

The failure to build enough homes means has led to millions of people now renting rather than buying their own home. But this is not the only reason, many younger people no longer see home ownership has a necessity and prefer the flexibility and lifestyle that renting gives them.

There is no doubt that the housing landscape in the UK has changed forever. As mind sets change and home ownership is no longer seen as the hallmark of success, the private rental sector is set to grow further, creating the ideal climate for buy-to-let growth.