New report exposes housing affordability crisis in the South West
A new report commissioned by Homes for the South West (H4SW) from University of the West of England (UWE) reveals plummeting levels of affordability for homes across the South West, with the area subject to higher than average property prices and lower than average incomes.
The full report is available at https://homesforthesouthwest.co.uk/home/affordability-report/. The research provides the most detailed data ever produced on the South West’s housing affordability – highlighting that most local authority areas in the South West are significantly less affordable than the rest of England as a whole.
House prices in the South West have risen nearly fourfold – while median wages have only risen by 83% – in the past 25 years, and in some areas, such as Bristol, the increase in house prices surpassed 500%. Some parts of the South West are now seeing median house prices of 28 times median earnings.
In every local authority area in the region, house prices have increased by at least 300% since 1997. Crucially, the significant decline in affordability across all local authority areas suggests that local planning authorities have vastly underestimated the proportion of housing that should be affordable in their area to meet local need.
Councils across the South West typically target 30-40% of homes in new residential developments to be affordable housing. This research suggests that this number should, across the median South West housing authority, be closer to 60% to meet the pressures on local incomes.
The research also highlights that every part of the South West has experienced a significant backlog in the delivery of new homes – this backlog currently sits at an estimated 200,000 homes across the region.
The report shows that in order to clear the backlog, and meet future need at the same time, the South West would have to build 70,000 new homes each year for the next five years, with 60% of those homes being affordable.
The report goes on to explain that the affordability crisis in the South West is driven by four key factors particular to the region:
- Land supply – a higher demand for housing than there is a supply of land to build on;
- Higher-than-average property prices contrasted against lower-than-average earnings;
- The Government’s Right to Buy programme reducing the amount of affordable housing available;
- People moving to the South West from other parts of the country as well as the numbers of holiday lets and second homes.
In addition to these factors, the under-resourcing of local authority planning departments has also been identified as a significant issue.
“This report makes it clear that the housing crisis in South-West England is reaching a breaking point. Years of undersupply have increased house prices and private rents beyond the reach of many and pushed up over-crowding, sofa-surfing, homelessness and council waiting lists“, says Victor da Cunha, Chief Executive of local housing association Curo and Chair of Homes for the South West.
He continues, “The lack of affordable housing in South West England is having a detrimental impact on the regional economy, as essential workers, such as doctors and nurses, are struggling to find suitable housing at levels they can afford. This not only affects the quality of life for these workers but also the provision of essential services for the wider community.”
“As we approach local elections, we would like to see all parties set out their vision for housing. In particular, we think it essential that local authorities revisit their planning guidance to increase the proportion of affordable homes built, and call on the Government to enshrine the 5-year land supply in housing targets – especially considering the suggestion of relaxing these in the recent NPPF consultation”.
Danielle Sinnet, Professor in Sustainable Built Environments at UWE who led the research says, “We were delighted to collaborate with Homes for the South West on this important piece of research, which highlights the extent of the housing affordability crisis in our region. We found that despite a desire from housing associations and local authorities to deliver genuinely affordable high quality housing, the attractiveness of the region, high land values and under resourced planning departments are significant barriers to delivery.”