The number of first-time buyers is static, demonstrating the need for more holistic housing policy, according to a new report.
As the housing crisis continues, first-time buyer figures highlighted in this year’s UK Housing Review, published this week by the Chartered Institute of Housing (CIH) reveal the significant need for government to focus housing policy and investment on a rented offer for households for whom home ownership is out of reach.
Figures highlight that government is investing a total of £42 billion in the private market, with only £18 billion spent on affordable rented housing - just 30 per cent of the total investment in housing.
The effect of the government's switch in priorities since last autumn’s Spending Review means that investment in affordable renting will fall to its lowest levels since the Second World War.
Of the government's target for new homes to be built by 2020, only 12 per cent will be affordable rented homes.
CIH research shows a fall in the number of affordable homes for rent over time and, analysis suggests that by 2020 there will be a nine per cent loss in both council and housing association properties let at social rents, equating to the loss of over 350,000 social rented homes altogether if further investment is not made.
With house prices once again approaching their 2007 peak in many areas, and well above them in some others, first-time buyer numbers have remained the same for the last two years - whereas 15 years ago, there were over 500,000 first time buyers each year. However, in 2015 this had dropped to only around 300,000 new first time buyers, despite the significant amount of government support for home ownership, reflecting the disproportionate rise in house prices compared to growth in average incomes.
Terrie Alafat, chief executive of CIH, said “The cost of housing means that millions of people are struggling to access a decent home at a price they can afford despite new government schemes to support home ownership.”
“We need housing policy for the 25-30 per cent of the population who will never be able to afford to buy a home of their own.”
“We know the government is committed to increasing the supply of new homes, something CIH welcomes and supports, but it looks like support for any kind of affordable rent is going to fall to very low levels at a time when there is an increasing need for this kind of housing.”
“It’s essential that support for home ownership isn’t expanded to the detriment of those who cannot buy, even with support.”