Grantham’s continuing housing shortage is putting the town’s (and
the Country’s) repute as a nation of homeowners ‘under threat’, as the number
of houses being built continues to be woefully inadequate in meeting the ever
demanding needs of the growing population in the town. In
fact, I was talking to my parents the other day at a family get together; the subject of
the Grantham Property market came up in the conversation (as I am sure it does
at many family parties in Grantham) after the weather and politics. My parents said It used
to be that if you went out to work and did the right thing, you would expect
that relatively quickly over the course of your career you would be buying a
house, you would go on holiday every year, you would save for a pension. But
now things seem to have changed?
Back in the
Autumn, George Osborne, used the
Autumn Statement to double the housing
budget to £2bn a year from April 2018 in an attempt to increase supply
and deliver 100,000 new homes each year until 2020. The
Chancellor also introduced a series of initiatives to help get first time
buyers on the housing ladder, including the contentious Help to Buy Scheme and
extending Right to Buy from not just Council tenants, but to Housing
Association tenants as well.
Now that does all sound rather
good, but the Country is only building 137,490 properties a year (split down
114,250 built by private builders, 21,560 built by Housing Associations and and
a paltry 1,680 council houses). If you
look at the graph (courtesy of ONS), you will see nationally, the last time the
country was building 230,000 houses a year was in the 1960’s.
How George is going to almost
double house building overnight, I don’t know, because using the analogy of a
greengrocers; if people want to buy more apples (i.e. houses) in a greengrocers’ shop, giving them more money (i.e. with the Help to Buy scheme) when
there's not enough apples in the first place doesn't really help.
Looking at the Grantham house
building figures, in the local authority area as a whole, only 650 properties
were built in the last 12 months, split down into 590 privately built
properties and 60 housing association with not one council house being built. This is simply not enough and the shortage of supply has
meant Grantham property values have continued to rise, meaning they are 3.7%
higher than 12 months ago, rising 0.8% in the last month alone.
I was taught at school (all
those years ago!), that’s it’s all about supply and demand, this economics game. The demand
for Grantham property has been particularly strong for properties in the good
areas of the town and it is my considered opinion that it is likely to continue
this year, driven by growing demand among buyers (both Grantham homebuyers and Grantham
landlords alike). You see Grantham’s economy
is quite varied, meaning activity is expected to remain relatively strong into
the early Summer of 2016, especially as some Grantham buy to let landlords try
to complete purchases ahead of the introduction of new stamp duty rules in
April.
.. and of supply, well we have spoken
about the lack of new building in the town holding things back, but there is
another issue relating to supply. Of the existing properties already built, the
concern is the number of properties on the market and for sale. The
number of properties for sale last month in Grantham was 316, whilst 12 months
ago, that figure was 334, whilst three years ago it stood at 504… quite a drop!
