Unaffordable housing in London not just due to supply, think tank says
Unaffordable housing costs in London are not simply down to supply, a think tank has said. Over the last two decades, earnings haven’t kept pace with house prices, the Centre for London has said, looking at ONS population and dwelling data as well as GLA affordability statistics. Its examination of housing stock and affordability data has found that overall, housing availability has changed little over the past twenty years.
In 2002, London had around 421 homes per 1,000 people. Following the financial crisis, the figure fell slightly before returning to a similar level in recent years. The number of dwellings per household has climbed over the same period, going from one home per household to just over 1.1 today.
At the heart of unaffordable housing costs in London is a fairness and distribution problem, Rob Anderson, research director at Centre for London said. Homes that exist are increasingly being owned by a smaller number of people who rent them out at high prices, leave them empty, or sell them at a price that is unaffordable for most people.
“There are as many owner-occupied homes per person today as in 2010, but houses are much more expensive,” he said. “Home ownership is 270% more expensive than it was in 2002. Private rented homes are much more common, but rents have risen significantly as a share of incomes and now take up 42% of average private renter income.”
The inflation comes from multiple factors, he said, including who is buying up the capital’s housing stock, including foreign investors who see property in London as an asset instead of as a home, causing prices to increase.
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