Extra Funding Is Required for Affordable Homes in the Falmouth & Helston Area
In our blog about the local Property Market we mostly only talk about two of the three main sectors of the local property market, the ‘private rented sector’ and the ‘owner-occupier sector’. However we cannot overlook the third sector, that being the ‘social housing sector’ (comprising Council housing or the likes of Ocean or Devon & Cornwall Housing et al). This sector is intrinsically linked to the performance of the market generally.
In previous articles, we have spoken at length about the crisis in the supply of property in our area (i.e. not enough property is being built). In this article we want to talk about the other crisis – that of affordability.
It is not just about the pure number of houses being built. It is also the balance of tenure (ownership vs rented) and within that, the affordability of housing, which needs to be considered carefully for an efficient and effective housing market.
An efficient and effective housing market is in everyone’s interests in our area homeowners and landlords alike, so let us explain…
An average of only 813 Affordable Homes per year have been built by Cornwall Council in the last 9 years
The requirement for the provision of subsidised housing has been recognised since Victorian times.
Even though private rents have not kept up with inflation since 2005 (meaning tenants are better off) it is still a fact that there are substantial numbers of low-income households in our area devoid of the money to allow them a decent standard of housing.
Usually, property in the social housing sector has had rents set at around half the going market rate. Affordable shared home ownership has been the main source of new affordable housing and yet, irrespective of the type of tenure, Cornwall Council is simply not coming up with the numbers required.
Although our local authority isn’t building or finding enough of these affordable homes, our local tenants still need housing. Almost inevitably a small number of tenants in the lower reaches of the market are falling foul of rogue landlords. This is not good news for tenants and the vast majority of law abiding and decent local landlords who are tarnished by the actions of the few. `Twas ever thus`
Whether it be the Tory’s, Labour, SNP, Lib Dems, Greens etc, everyone needs to put party politics aside and start building enough homes and ensure that housing is affordable. Perhaps of equal significance is ensuring that the quality of the product that is built is of a good quality such that it will stand the rigours of weather and time. All too often we see `new` build properties which lack that quality and wonder what those areas will be like in twenty years and the type of occupant that will be living there then.
Although 2017 was one of the best years for new home building in the last decade (217,000 homes built), overall new home building has been in decline for many years from the heady days of the early 1970s, when an average of 350,000 new homes were being built a year.
As you can see from the graph, we simply aren’t building enough ‘affordable’ homes in the area.
The blame cannot all be squarely placed at the feet of the local authority as Council budgets nationally, according to Full-Fact, are 26% lower than they have been since 2010.
So, what does this mean for local homeowners?
Well, an undersupply of affordable homes will artificially keep rents and property prices high. That might sound good in the short term, but a large proportion of our local landlords find their children are also priced out of the housing market. Also, whilst your local home might be slightly higher in value, due to this lack of supply of homes at the bottom end of the market, as most people move up the market when they do move, the one you want to buy will be priced even higher.
Problems at the lower end of the property market will affect the middle and upper parts. There is no getting away from the fact that the local housing market is all interlinked .. it’s not called the Property ‘Ladder’ for nothing!