Houses need to be built.

Houses need to be built.

Houses need to be built.

There is just not enough houses being built.

This is a strong argument for our current housing crisis in the UK. Just like in any market there is a core relationship between supply and demand. If the supply does not match the demand there can be huge fluctuations in price. For instance if there is far more supply than demand then often the price will go down. And if there is far more demand than supply then price will increase.

So in the UK there just is not enough houses being built for the demand that is needed. The problem with housing is in a country, in theory, there really is only a finite amount of houses you can build. And it takes a long time to build a house, it takes a lot of planning and it takes a lot of negotiating with councils, government and developers.

The government to build 300,000 new houses by 2020. But when we get reports that councils are unable to hit house building targets. it feels like the pressure is not going to let up.

The guardian reported on the following

Targets for new homes are likely to be missed by half of England’s local authorities, according to a damning assessment of the government’s housing strategy, while increasingly profitable building companies are getting away with paying less for infrastructure and more than half of councils have failed to draw up adequate plans to solve the housing crisis. “

See full article here

(you are now departing from the regulatory website, Coleshill Mortgage Services or Quilter Group are not responsible for the accuracy for the linked site)

So what does this mean for the country in regards to house prices. Well not enough houses, means a lack of supply, which as mentioned above means either a maintenance of prices or a rise of prices for houses.

Looking at the below image you can see we just do not have enough homes per capita.

See the full report here 

(you are now departing from the regulatory website, Coleshill Mortgage Services or Quilter Group are not responsible for the accuracy for the linked site)

It’s just over one house per two people over 20. We have some of the lowest amount of houses. Think of people who have more than two properties, old people that live on their own, each one adding to that rate. And their right to. But we are drifting apart from the standard of other comparable countries.

It’s very difficult to get a good answer apart from build more house and that is what the government wants to do and is trying to do.

Your home may be repossessed if you do not keep up repayments on your mortgage.

jamesellis84