Tuesday, 10 March 2015

Not building enough new houses? Really?

Recently the BBC News Magazine reported that the current housing issues are down to not enough new houses being built.  This is preventing people climbing onto the first rung of the property ladder.

Really?  Not enough houses being built?  Surely the ridiculously inflated prices combined with the difficulty in obtaining mortgages combined with having to find a much higher than ever deposit is the root of the problem?

There certainly does not appear to be a shortage of property, both existing and new build, for sale in Coventry.

In the last 10 years, within walking distance of my house, there have been 4 factories (including both the Radford plant and the Brown's Lane headquarters of Jaguar Cars) and a transport hub demolished, all of which have had houses built on them.

We have had pubs demolished to be replaced by houses.



Towards the city centre, a former council depot has been cleared and houses are being built.

In the city centre itself, at least one pub, one hotel, two multistorey office blocks and the main post office have all been converted into accommodation, albeit for students.

The main sorting office for the city has been sold off for apartments to be built.

The city centre hospital, which was much more accessible to users than the current one near the M6, is being demolished for housing and a school.

Recently planning permission was given to build more houses on green belt land just outside the city.

Add this to the 1000+ existing houses for sale in the city and its surrounds and I cannot see that there is a lack of housing, just a lack of affordable housing.

People bought in the boom years and when bad times hit, no-one wanted to sell due to negative equity and not wanting to make a loss.  They just moved into smaller, cheaper, rented accommodation and rented their own property out.

Houses prices stagnated and then started rising again.  The average house price in the UK is currently £180k, the average wage £26.5k, in 2008, these were £157k and £24k, house prices have increased by 15% in 10 years whilst wages have only increased by 10% (Google is wonderful).  A 5% deposit in 2005 was £8k, the 20% now needed would be £36k which is a lot more than a year's salary.

That is what, in my opinion, is the cause of the current housing problem.

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