The government is finally starting to admit what we’ve all known for a very long time – the current housing situation in this country is damaged, and in many places it is damaged beyond repair.
It is not new news to hear that first time buyers cannot get on the housing ladder, and certainly not in areas that appeal most to them. In a lot of areas house prices are 8x that of an average salary – the numbers just don’t stack up and it is an impossible situation for many people to get to grips with.
It is also a sign of the trouble we are in as a nation when you hear that house prices in areas such as Harrogate in North Yorkshire are stagnating and in some cases, even going down. Less desirable areas both in the north and east are upcoming with heightening house prices, proving that people really are prepared to live anywhere just to get on the housing ladder.
Because of the dire situation with house prices, the government is relinquishing its position on persuading people to buy their own homes, as they know that this is unlikely for many people now, and are instead putting more onus on people renting their first home and have come to grips with the fact that renting is going to be the way forward, probably for the next couple of generations. Home ownership is now a distant dream for many and the government knows this.
But something has got to give as the cost of renting is also expected to jump in the next five years and soon people will not even be able to pay the rent on a house that they don’t even own. It is a sorry state of affairs. Rented property to choose from is also dwindling too as this market becomes saturated. It is expected that by 2025 over 60 per cent of people will be renting privately. We think this is a really sad fact.
Labour has been piling the pressure on the government to build more new homes saying that this is the way to solve the housing crisis. They say the housing crisis is at critical level because there are not enough homes out there for everyone. What?! We appreciate that new homes do need to be built and that there is a shortage, but the real problem here is that people cannot afford to buy the homes once they are built. All these homes are getting built but normal working first time buyers cannot afford them and are instead having to be rented out. That is the crux of the housing crisis in our opinion – that normal hard working youngsters cannot afford their own homes.
So, what can be done about this ever-deepening problem? Unfortunately, not a lot. If there was any way that a magic wand could be used to lower house prices then that would help; but the magic wand doesn’t exist and whilst our population continues to rise and our housing stock continues to choke up, there is no real way out of this housing hole.
If wages went up this may help, but again, what’s the likelihood of this happening? None, especially not at the rate that they need to. Deposits are a big deal for many people too. Saving thousands for a deposit is difficult for the majority of people – especially when outgoings run into the hundreds of pounds a month. Even if people do manage to save up some of their deposit, it will take years to get to the level required, which can be financially and emotionally difficult to remain on track and most of the time their ideal houses will have been up for sale and bought. It’s very frustrating for everyone involved.
A lot of people are hoping that the Brexit vote will mean a cut in the numbers of people coming to the country and effectively putting pressure on the housing stock, but we’re still a little sceptical as to whether Brexit will impact this or not. We believe that unless things work in tandem and harmony (wages rise, more houses get built and house prices start to come in line with more realistic affordability) we cannot see an end to the doom and gloom.