Housing crisis: 350,000 UK households unable to rent or buy without help by 2020

70,000 people a year to be priced out even if the Government meets its housebuilding targets

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The Independent Online

At least 70,000 new households will be unable to afford to rent or buy a home in the UK in the next five years even if the Government meets its target of building 200,000 new homes a year.

Research by Savills, the estate agent, said this means a total of 350,000 households in England will not be able to afford to buy or rent houses at market rate by 2020.

Even if the Government builds 200,000 homes a year, inflated house prices mean 70,000 households would not be able to access the market unassisted every year. That’s 350,000 over the five-year term of a parliament.

In London, some households with an income of £60,000 will be priced out of the housing market.

Savills said that the national living wage, which rises to £9 per hour by 2020, will do little to help those households in London and the south where people earning far more than the minimum still cannot afford to rent or buy. Those families are reliant on a shrinking pools of benefits and tax credits. Efforts to increase affordable housing in London have only filled 36 per cent of the gap.

In London, some households that earn £60,000 cannot afford to buy or rent

The range of incomes for households in need of sub-market housing

Changes to renting rules, replacing social housing with “affordable rents” that are 80 per cent of the market rate, will also impact housing availability. Savills said that in a typical London borough, market rent levels would need to be reduced by at least half to make them affordable to households excluded from the housing market.

But local councils are struggling to subsidise rented housing without support from the Government. In lieu of this support, more councils are expected to sell land or lease it to homebuilders to pick up the slack.

Despite Savill’s gloomy analysis, the UK’s second largest housebuilder Taylor Wimpey described the outlook for the UK housing market as “healthy”. It said that it had benefitted from local authorities looking to convert plots of land, with over 7,600 plots of land in their ‘landbank’ from a combination of land owners, local authorities and communities.