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Tuesday, April 16, 2024

LandlordBuyer Identifies 41% Growth in Residential Construction in UK Over Last Decade

LandlordBuyer’s recent analysis has identified a significant 41% growth in residential construction in the UK over the last decade, notwithstanding the enduring challenges of housing overcrowding that remain a concern for municipal authorities.

The analysis points out that from January to September 2023, the UK saw the construction of 138,570 new residential properties. This figure represents a notable 41% growth from the number of houses built during the same period ten years ago, which amounted to 98,080 from January to September 2013.

However, despite the substantial growth in residential construction, over 1.1 million households in England and Wales are still classified as ‘overcrowded’, comprising 4% of the total households.

The phenomenon of overcrowding is particularly acute in larger cities such as Birmingham, London, and Leicester, with higher incidences noted among private rental tenants (7% of households) and social housing tenants (9% of households), as opposed to owner-occupied households (2% of households).

Jason Harris-Cohen, Managing Director of LandlordBuyer, remarked, “It’s absolutely essential that we build more new homes, and it’s great to see an uplift in supply over the last decade. While this is positive, we need to look at how the figures break down to establish why we still have a serious issue of overcrowding.”

He also noted, “While 153,300 new build homes were started in 2023, only 138,570 were actually completed/built. That means almost 15,000 new homes never made it over the line in the year construction started.”

Highlighting the obstacles to completing new housing projects, Harris-Cohen cited the lack of workforce and the surge in material costs, urging local governments to extend more support to the building sector.

He also addressed the issue of how new homes are distributed, stating, “The allocation of new homes also needs scrutiny. Overcrowding is most prevalent in the social housing sector but housing associations and local authorities only gained 32,290 new homes in 2023. Conversely, the private sector gained 106,280 new homes – an out-of-kilter proportion given owner-occupiers were the least likely to suffer overcrowding.”

Harris-Cohen pointed out the potential role of private landlords in easing the overcrowding situation.

He elaborated, “New builds are an attractive proposition as they are low maintenance and energy efficient but they have always attracted a price premium. Furthermore, landlords have tended to favour apartments in city centre locations – the locations identified where overcrowding is at its worst. When figures show 7% of private renting households suffer from overcrowding, more houses to rent, rather than a saturation of flats, may help address the issue.”

Concluding his statement, Harris-Cohen called for developers to provide more incentives for private landlords to invest in family-oriented properties, “It does fall on housebuilders, however, to incentivise private landlords in the same way they do owner-occupiers. Legal fees paid, a stamp duty contribution and a furniture pack attached to family homes would help property investors reassess what they purchase and where.”

Sam Allcock
Sam Allcockhttps://businesslancashire.co.uk/
Sam Allcock is a highly regarded digital entrepreneur with over 20 years’ experience in online marketing for some of the World’s biggest brands. He has extensive knowledge and experience in SEO and digital marketing. He is based in Cheshire but has an interest in all things going on in the North West and enjoys contributing local news to the site.
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