The UK housing shortage and its effect on the property sector

The UK housing shortage and its effect on the property sector

How is the housing shortage in the UK affecting the property sector? Hugh Lumby, partner and head of the global real estate practice at Ashurst, highlights some of the current problems facing the property market and explores the government policies that are seeking to tackle those problems.
What are the current issues surrounding UK housing stock shortage, and what are the underlying causes of these issues?

The housing shortage has been making headlines for a long time and featured in every political party’s manifesto before the 2015 general election. As the UK population continues to increase, the housing shortage becomes more acute and first time buyers are struggling to get on the housing ladder—particularly in London and the South East.

There are various government initiatives designed to address the soaring cost of buying a house. These include the right to buy ISA and the starter homes scheme—which aims to provide 200,000 homes at a 20% discount for first time buyers in England under the age of 40. However, a number of commentators have suggested that these measures may not make homes more affordable, as sellers may simply increase their asking price because of these buyer incentives.

Furthermore, the government seems to focus on home ownership, but it is important not to lose sight of the role that the private rented sector can play in solving the housing crisis.

The government’s decision to extend the right to buy scheme is an example of the government’s desire to promote home ownership. The extension of the scheme will allow more social housing tenants to buy their homes at a discount. This may have won votes at the general election, but it is difficult to see how this will solve the housing crisis unless they replace all the council houses that are sold. History tells us there is no guarantee that this will happen.

How is the shortage affecting the property sector?

Developers need available land, planning permission and finan

Subscription Form

Related Articles:
Latest Articles:

Already a subscriber? Login
RELX (UK) Limited, trading as LexisNexis, and our LexisNexis Legal & Professional group companies will contact you to confirm your email address. You can manage your communication preferences via our Preference Centre. You can learn more about how we handle your personal data and your rights by reviewing our  Privacy Policy.

Access this article and thousands of others like it free by subscribing to our blog.

Read full article

Already a subscriber? Login

About the author: