Affordable housing doesn’t only benefit the people who get to live in the properties. They help bring prosperity to the entire UK.
Affordable housing in the UK, or rather, the lack of it, is a hot topic at the moment. At the last election in December 2019, all the parties put forward ideas to make housing less prohibitively expensive, with the Conservative Party pledging to bring in policies that encourage the private sector to provide more affordable homes.
After many years, it’s something the Government and the housing industry have begun to wake up to. The number of affordable houses built in 2019 was the largest for some time.
- 57,485 affordable homes were built in England in 2018/19, up 22% from the previous year
- Of the 57,485 affordable homes provided last year, 51% were for affordable rent, 30% were for shared ownership and 11% were for social rent
- New builds made up 53,044 (92%) of new affordable homes delivered
However, there is still so much more to be done. There are still hundreds of thousands of people and families left behind by the property market. In addition, as we shall see, affordable housing doesn’t just bring benefit to the people who get to own a home; there are several side-benefits, that have a positive effect on the whole UK economy.
Here are the five top reasons why the country needs more affordable homes.
1 – Employment
Building new homes, that young people and families can afford, creates jobs. Construction companies have to take on more builders, engineers, labourers, etc. Companies in the supply chain win more business, so they need to employ more people too.
Once the homes are built, there is more work for property companies, housing associations and estate agents, who will take on more people to administrate the affordable homes.
Then there is the secondary boost to the wider economy that new settlements bring. New housing estates need new shops, schools, transport links etc. All of these require people to build and run them.
2 – Homelessness
With more affordable housing available, fewer people will have to live in temporary accommodation, or worse, on the street.
Homelessness is rife in most UK towns and cities, with the problem only growing in recent years. The latest research from Shelter found that there are 320,000 homeless people in the UK, an increase of 4% from the previous year. The number of people sleeping on our streets has doubled in the last ten years, while more than 80,000 people, some with young children, are in temporary accommodation. Homelessness isn’t just not having a home. It often leads to mental health problems, illness and dependence on drugs and alcohol.
If an increase in affordable housing stock can create opportunities for these people to get a permanent address, the benefits are massive.
The lack of housing that people can afford to buy has also created a class of people who can only rent, with many unscrupulous landlords taking advantage of this situation – making housing more reasonably priced can rebalance this inequality.
3 – Health
Perhaps one of the most notable side benefits of building more affordable homes is the health benefits that arise. People who have their own home which they can afford, a fixed address, tend to lead healthier lives. They eat better, because they are able to plan and budget more effectively. They have access to doctors and hospitals, and can afford medical prescriptions. They are more likely to exercise. Having a permanent home also eases stress, anxiety, depression and other mental health issues.
For children moving out of temporary accommodation and into affordable housing, they can settle into a school, which is better for their development. They will also have access to community facilities such as parks and sports centres.
People living in low-quality accommodation are more likely to be exposed to a poor environment, with air pollution, mould in the house and more. These lead to medical issues, such as respiratory illnesses. Moving into new, permanent accommodation gives you access to green spaces, trees and gardens.
All in all, more affordable properties lead to a healthier nation, and reduces demand on the NHS.
4 – Government
Although the Government is not pledging to build affordable housing itself, preferring to encourage the private sector to take the strain, it will gain several benefits from having more affordable housing stock. Most of these benefits come as cost savings. By extension, all UK taxpayers win, because their taxes can be used for more beneficial purposes.
There are several areas where more affordable homes allow the Government to reduce expenditure:
- Housing benefit – If people are in their own homes which they can afford, the government does not need to pay housing benefit for temporary accommodation
- Health – homelessness and low-quality housing can cause many health problems, which need to be treated by the NHS. More affordable homes can reduce this cost
- Social services – The government will not have to spend so much time and money looking after at-risk children in low-quality housing, if their families are settled in a home they can afford
- Policing – Homelessness and poverty are causes of crime. Reducing these factors will reduce instances of crime and the burden on the police
Additionally, with more people in real homes rather than temporary accommodation or on the streets, local government will see an uptick in council tax revenue.
5 – The wider economy
We’ve seen how a rise in affordable housing stock can boost business, create jobs, save money for the taxpayer and improve the health of the UK. While these benefits are great when taken on their own, when you put them all together, it creates a multiplier effect greater than the sum of its parts.
For example, the jobs that are created by building new houses and settlement:
- The workers will spend more money with local businesses
- They will pay more in tax to the Government
- They will learn new skills and may even start their own businesses
All of this makes the UK more prosperous. It’s hard to see a downside to building more affordable homes. We hope to see the current affordable home building figures rise much higher in the coming years.