CML - Wales Needs 8,600 New Homes a Year - and 33,000 to Clear Existing Backlog in Demand
Wales needs 33,000 new homes to clear a backlog in demand, according to research published by the Council of Mortgage Lenders. This requirement is over and above a need for 8,600 new homes a year between 1998 and 2016 to keep pace with growing demand. The research shows a strong preference by people in Wales to buy a new home rather than an existing property, perhaps because of the poor condition of the country's relatively old and crumbling housing stock.
The research, which looks at housing demand in Wales, says that 6,100 new private sector homes and 2,500 social sector homes are needed each year. Recently, the private sector has been building an average 7,100 homes each year but the social sector has been completing only 1,600 per year.
People in Wales show a distinct preference for newly-built homes, and are prepared to pay higher prices for them. The price of a new property in Wales in 2001 was nearly 50% more expensive than a second-hand one. So while the private sector needs to build more new homes to satisfy the build-up of demand, there is also a need for older, unpopular properties either to be cleared or renovated and re-used in the social rented sector.
The report therefore urges the Welsh Assembly Government (WAG) to develop national and local housing strategies that more closely align demand and supply. The WAG's National Housing Strategy aspires to ensure that everyone in Wales should have the opportunity to live in good quality, affordable housing; to be able to choose where they live; and to decide whether buying or renting is best for them and their families.
Local authorities and the WAG will therefore need to develop creative ways to improve the existing housing stock, while clearing property that is deemed unsuitable for improvements. One option is to transfer property to the social sector and renovate it where appropriate. This would help to minimise problems in both sectors and would be a practical demonstration of joined-up thinking about housing in Wales.
Commenting on the research, the Chairman of CML Cymru Ian Smith said:
"This new research gives politicians and housing providers a valuable new insight into how many homes will be needed in Wales between now and 2016, to meet current and future demand. But demand and supply could drift further out of line unless the existing backlog is dealt with and more is done to upgrade or clear the very large stock of older, poor quality housing."