Chelmsford’s continuing housing shortage is putting the City’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 City. In
fact, I was talking to my sister the other day at a family get together; the subject of the Chelmsford
Property market came up in the conversation (as I am sure it does at many family
parties in Chelmsford, after the weather and politics). My sister 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 Chelmsford house
building figures, in the local authority area as a whole, only 460 properties
were built in the last 12 months, split down into 310 privately built
properties and 150 housing association with not one council house being built. This is simply not enough and the shortage of supply has
meant Chelmsford property values have continued to rise, meaning they are 9.5%
higher than 12 months ago, rising 1.1% 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 Chelmsford property has been particularly strong for properties in the good
areas of the City and it is my considered opinion that it is likely to continue
this year, driven by growing demand among buyers (both Chelmsford homebuyers
and Chelmsford landlords alike). You see Chelmsford’s economy is quite varied, meaning activity is expected
to remain relatively strong into the early Summer of 2016, especially as some Chelmsford
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 City 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 Chelmsford was 388, whilst 12
months ago, that figure was 528, whilst three years ago it stood at 756… a
massive drop!
With demand for Chelmsford
property rising, minimal new homes being built and less properties coming onto
the market, that can only mean one thing ... now is a good time to be a
homeowner or landlord in Chelmsford. For more articles like this, please visit the Chelmsford
Property Market Blog www.chelmsfordpropertyblog.co.uk
