The latest data figures from the DCLG on Affordable Housing supply April 2015 to March 2016 published yesterday, show that the number of affordable homes built in England in 2015/16 has fallen to its lowest level for 24 years. In total, just 32,110 new affordable homes were added – a 52% decline on the previous twelve months (66,600).
Figures for affordable housing are split into three catagories: social rent, affordable rent and affordable home ownership/shared ownership.
The DCLG figures showed the number of new homes for ‘social rent’ fell to just 6,550 – 83% lower than the 39,500 built in 2010/11. The number of homes for private rental at ‘affordable rent’ has now fallen 41% from a peak of 40,730 in 2014/15 to 16,550 in 2015/16. The total constructed for ‘affordable home ownership’ has also dropped 21% from 15,970 to only 3,430 over the same period.Labour housing spokesman John Healey said:
“The figures showed the government was building the lowest number of social rented homes since records began. This all-time low results from Conservative ministers who have washed their hands of any responsibility to build the homes families on ordinary incomes need. We’ve seen six wasted years with the Tories in charge of housing. They have no long-term plan for housing and they’re doing too little to fix the housing crisis for millions of people who are just managing to cover their housing costs.”
Caught in a trap – Leasehold new houses
Given the information, no new homebuyer would ever choose to buy a house with a leasehold title. Perhaps this is why some housebuilders hide this extremely important information from new homebuyers. Even if they do think to ask about the property title, it’s no good saying “People are scared of change because it’s something new. But it’s virtually freehold.” As a Persimmon sales advisor told a reporter from The Guardian.
Is it Freehold? New homebuyers are getting caught out by newly-built leasehold houses.
Justin Madders MP for Ellesmere Port and Neston, is calling for a ban on leasehold new houses:
“It is clear this system is being abused to drive huge profits at ordinary homeowners’ expense. There is no need for there to be leasehold properties, particularly those on an estate where the properties are mainly detached houses.
“They need to be banned – it may be a convenient way for developers to get extra profit from their building work, but once they get in the hands of these private equity companies the profit motive overrides any considerations that there are real people living in their homes, who are being asked to stump up eye-watering sums.”
As Patrick Collinson reported in The Guardian on Saturday 29 October 2016, a new house built by Taylor Wimpey in Ellesmere Port was sold for £155,000 on a 999-year lease in 2009. Seven years later, the owner was quoted £32,000 to buy the freehold from E&J estates who had bought the freeholds from Taylor Wimpey. Another buyer was quoted up to £40,000 by E&J estates for the freehold of their 2011, 4-bedroom £122,000 house and despite a long lease, another new homebuyer in Manchester is was forced to pay £38,000 to buy the freehold on their recently built home.
Escalating ground rent is another issue. Taylor Wimpey set the ground rent at £295 a year on the Ellesmere Port development, with the contract stating that ground rent will double every ten years!
Prefab Sprout! Flat pack new homes – no Allen keys required! But will prefabs be the answer to Britain’s housing crisis?
As reported in The Telegraph last Saturday, the government is to embark on a building programme to “embrace the first new generation of pre-packed homes since the reconstruction after the Second World War.” By using prefabricated homes that can be delivered to site and built [thrown up] in 48 hours. While the Department for Communities and Local Government [DCLG] is not expected to set a hard target, (one lesson learned at least!) government sources said it was hoped that more than 100,000 prefabs could be built by May 2020 – around 2,500 a month. Theresa May’s Government is struggling to work out how to meet a commitment to build “a million new homes by 2020”.
Clearly the large housebuilders, supported in every respect by this and previous government policy, have failed to deliver any meaningful and desired increase in production – even now, they are building fewer new homes than were built in 2007. Profiteering from landbanking? – Channel 4 Dispatches ‘Britain’s Homebuilding Scandal’ due to be aired on Monday 7 November 2016 will no doubt highlight this.