In Camberwell and London, there continues to be a shortage of housing to either rent or buy. You could say this is putting the notion that we are a nation of homeowners under threat. With continued high levels of migration in the UK, there appears to be no immediate solution on the horizon,
In fact, I was talking to my parents the other day at a family get together; the subject of the Camberwell Property market came up in the conversation after the weather and politics. My parents said it used to be that if you worked hard and progressed in your profession, you could expect that you would be able to buy a house, go on holiday every year, and put some money aside for your pension. However, is still a realistic expectation?
George Osborne has been focused on the property market and in his Autumn statement he announced that in April 2018 he will double the housing budget to £2bn a year to try and deliver a further 100,000 new homes every year until 2020. Alongside this, The Chancellor has continued with a series of initiatives to help first-time buyers purchase their first home by extending the Right to Buy Scheme and the Help to Buy Scheme.
On paper, this sounds great but as a country, we are only building 137,490 properties a year (114,250 built by private builders, 21,560 by Housing Associations and 1,680 council houses).
Take a look at the graph from the ONS below, the last time we built 230,000 homes a year was back in the 1960’s so it looks like a flight of fancy that George Osbourne can suddenly double the rate of house building overnight.
Here is a simple analogy of a bakers shop; if people want to buy more bread (i.e. houses) in a bakers shop with a limited supply of bread then giving the customers more money isn’t going to help keep the price of bread down. (i.e. with the Help to Buy scheme)
Looking at the Camberwell house building figures, in the local authority area as a whole, only 1,050 properties were built in the last 12 months, split down into 730 privately built properties, and 320 housing association and not one council house was constructed. This is simply not enough, and the shortage of supply has meant Camberwell property values have continued to rise, which is why they are 11.4% higher than 12 months ago.
We’re taught at school that’s it’s all about supply and demand, and demand for Camberwell property has been particularly strong as more people compete over fewer properties.
This trend upwards of property prices is likely to continue, driven by the growing demand among buyers (both Camberwell homebuyers and Camberwell landlords alike). In the short term, you also have to consider the additional pressure on house prices caused by the rush by some Camberwell landlords try to beat the stamp duty changes due to come into effect in April.
Apart from not building enough property, we also have to consider the existing stock as part of the supply issue. In 2015 545 properties were sold, in 2014, thatfigure was 575 while back in 2006 it stood at 787, quite a drop!
With demand for Camberwell property rising, minimal new homes being built and fewer properties coming onto the market, that can only mean one thing … now is a good time to be a homeowner or landlord in Camberwell. For more articles like this, please keep an eye or my Camberwell Blog or drop into the office for a friendly chat.