Crumbling market causes housing crisis in the East
Midlands
News
Section: Longhurst Group RSS Feed
Publish Date: 7th December
Author: Hannah Bence
Rural communities in the East Midlands are sitting on a
time bomb as house building slows to its lowest rate since the
1920s.
That’s the view of Bob Walder, Chief Executive of Longhurst
Group, one of the largest housing providers in the East Midlands,
following today’s launch in parliament of the National Housing
Federation’s Home Truths report.
The report reveals that the average house price in the East
Midlands in 2010 was £164,921 – 8.3 times the average regional
income. In rural areas (home to 30% of the population) that figure
rises to 9.3.
It states that a 25% deposit for a mortgage on an average home
in the region would cost £41,230 – more than two years’ gross
average income.
And, while 123,780 households in the East Midlands are on social
housing waiting lists (that’s one in 15), just 10,090 new homes
were built in the region last year.
Bob’s deep concerns also follow the Government’s acknowledgement
of the crisis facing the country’s housing market. With the launch
of its £400million ‘Get Britain Building’ fund, the government
hopes to see 16,000 new homes built across the country in a bid to
get the market back on track.
Since joining Boston-based Longhurst as Chief Executive Officer
in 1989, Bob has been involved with five successful business
amalgamations and partnerships which have helped the company grow
from 800 to more than 17,500 homes alongside the expansion of
community housing and care and support services.
And he believes the time has come to turn the spotlight on
regions like the East Midlands, which is getting a raw deal when it
comes to affordable housing.
The East Midlands is currently the fastest growing region in the
country as an increasing number of people are choosing to live or
retire there from other parts of the UK.
Bob says: “There really is a deepening housing crisis in the
East Midlands.
“As a country we have built fewer houses in the last year than
we ever have since the 1920s and that’s primarily down to the
economic situation we face. There are an increasing number of
people waiting at the bottom of the property ladder but there are
fewer and fewer opportunities to get on it and I believe this
number may well rise significantly over the next year. Everybody
wants their children and grandchildren to have chances in life but
it seems that in places like the East Midlands these chances are
being taken away at an alarming rate.”
According to the Home Truths report, the number of households in
the region will rise by 25% by 2033 – 22,000 a year. It also
reveals that the East Midlands is the third most rural region in
England.
Bob says: “There is a considerable cost, much higher than in
urban areas, to build in rural communities and local people tend to
have a lower household income.
“As a result we have this crazy situation where people are
commuting past each other to work in the opposite area to where
they live. Many of those working in urban areas are commuting from
the villages, while those working on the land have to commute from
urban areas because they cannot afford to live close to where they
work.”
As well as its work managing homes and supporting communities,
Longhurst Group also builds substantial numbers of new homes of all
types through the Blue Skies Consortium, which was the leading
development partnership in the East Midlands within the 2008-2011
affordable homes development programme.
Partners built more than 3,000 homes for rent and low-cost home
ownership in that time** and invested over £300million in the
regional economy.
As part of the consortium, the Group was recently named one of
the UK’s top 10 developers for the third year running and is on
track to retain this status for the final year of the
programme.
Bob says: “We will strive to continue our development programme
but, with the new funding regime, government grants in the East
Midlands are much less and this will make it tougher for us to
maintain the pace of development needed to meet the growing demands
within the region.”
The East Midlands is proving particularly attractive to people
moving from other parts of the UK, especially those leaving the
fringes of London to retire to rural Lincolnshire where property
prices are much lower than in the South.
Bob says: “These factors particularly exacerbate the problems
for local people in Lincolnshire on lower wages. House prices
are higher than they would otherwise be elsewhere in comparison to
wages locally.
“At the moment we are still completing the big development
programme but waiting lists in general are ever increasing. And
it’s not just those on the waiting lists we need to think about –
there are people who never appear on a waiting list who are living
with family or friends and are struggling to move to a place of
their own.
“People simply can’t afford to buy into the market because of
the size of the deposit required and their wage levels. The
social and affordable housing which would once have given them
their only chance of getting onto the property ladder is in very
short supply. If we don’t address this now, I believe we are
storing up major problems for the future.”
Bob says Longhurst Group is actively looking at different ways
of funding new affordable housing as part of the Blue Skies
Consortium and is keen to forge new partnerships.