Following a recent report from the Halifax showing that 65% of towns are unaffordable to key workers, the National Housing Federation (NHF) has renewed its call for increased investment in affordable housing.
David Orr, chief executive of NHF, said: "Already, thousands of key workers and moderate earners are shut out of the housing market - and our forecasts show the situation is only going to get worse. The average national house price in England is due to rise by around 50% over the next five years. It is all the more important that the Government delivers a real commitment to affordable housing in next year's Comprehensive Spending Review, and brings in planning reform to speed up the delivery of new homes."
Housing market forecasts produced for NHF by Oxford Economic Forecasting (OEF) show that the average house price in England will be £286,500 in five years' time. The OEF forecasts, published in NHF's report "England's Housing Timebomb: Affordability and supply 2006-2011" show that house prices are due to rise by around 50% over the next five years, but salaries are due to rise by 19%.
Non-profit housing associations provide low cost home ownership schemes and affordable rented homes for 5 million people in England. They are building 28,500 new affordable homes a year and refurbishing 10,500. They are doing all they can to help, but they want and need to do more.
The NHF, representing England's housing associations, believes around 80,000 new affordable homes a year are needed to avert our housing crisis. The Federation is calling for increased Government funding for housing associations to achieve this.
David Orr said: "While some home owners see rising prices as good news, the affordability crisis is having a damaging effect on our communities. Public services suffer as key staff are priced out of local housing markets. Young people are unable to stay in the area where they grew up. Low-income families are forced to live in poor quality, cramped conditions. Housing associations are part of the solution. They provide five million affordable homes in England, including 100,000 shared ownership homes for key workers and others unable to get on the ladder. But they need to build much more: we need to increase affordable housing supply from 40,000 homes to 80,000 to stop our housing timebomb from exploding. It's vital that the Government makes affordable housing a priority in next year's Comprehensive Spending Review, and brings in planning reform to speed up the delivery of affordable homes in mixed communities."
