Landlords, strong demand for property set to continue!
Affordable Housing Construction Still At Snail’s Pace
The latest figures from City Hall show the parlous state of ‘affordable’ house building in London. Just 2,670 ‘affordable’ homes have been built since April this year, with even fewer started.
The Greater London Authority issues regular updates about how many homes have been completed (ie, built and ready for people to move in) and started (which gives an idea of what will be available in the near future). Between April and October this year, 2,670 ‘affordable’ homes have been built, with 1,983 started. To give you an idea of how this compares to previous years, take a look at these figures:
2008-2011 funding cycle
April 2008-March 2009: Starts 11,382 Completions 11,537
April 2009-March 2010: Starts 15,629 Completions 12,602
April 2010-March 2011: Starts 16,351 Completions 12,869
2011-2015 funding cycle
April 2011-March 2012: Starts 4,143 Completions 16,173*
April 2012-March 2013: Starts 10,092 Completions 8,114*
April 2013-March 2014: Starts 8,792 Completions 8,709
April 2014-June 2014: Starts 1,983 Completions 2,670
Boris Johnson has previously promised we’d have 55,000 new ‘affordable’ homes (if you start counting from April 2011). He’s going to miss that target, and we reported back in August that there was £380m in housing funding unallocated.
Why do we keep writing ‘affordable’ in sarcastic inverted commas? Because the definition of ‘affordable housing’ changed between those two government funding cycles. The current programme, called the Affordable Homes Programme, has less money in it than the 2008-2011 cycle and developers are meant to make up the difference by charging higher rents — up to 80% of the rate found on the open market, in some cases. So the new ‘affordable housing’ that London’s building won’t necessarily be much cheaper than renting from a private landlord. And the situation looks even worse once you realise that traditional council housing — that’s rented out for around 30%-40% of open market rates — is being sold off under Right to Buy. 3,190 of London’s council houses were sold off in 2013-14.
* The majority of the houses completed in these years were funded under the 2008-2011 programme, they just took a while to get finished.
As you can see the demand for rental property looks set to continue with a severe shortage of accommodation in London & South East. Our guaranteed rent scheme can protect you from the exposure of tenants not paying rent and having to potentially evict tenants who breach their tenancy conditions.