Tee Government published statistics at the end of 2008 identifying a population growth averaging 7% across the UK by the year 2017, which equates to roughly 4 million more people. This is due to a combination of effects such as higher birth rates, longer life span and net migration into the UK.
So what does this mean of housing demand?
Well, if we assume 25 million houses / flats today, then this equates to another 1.75 million new homes by 2017, which is an average of around 220,000 new homes each year.
But, we have a short-medium term problem, the private sector new build has drastically reduced due to the credit crunch, so in 2 or 3 years we could start to see an acute shortage of homes.
Today the Government also announced they would build 110,000 new affordable homes over the next 2 years, this equates to 55,000 homes per year and compares with a growing demand of 220,000 homes based on the Government statistics. So we have to assume that the private sector needs to build 165,000 new homes each year to keep up with demand.
Lets hope the property market recovers soon and builders start to produce the new homes required!
