England’s housing crisis is deepening, according to a report from KPMG and Shelter. It says that less than half of the 250,000 new homes required every year to keep up with demand are being built, and calls for the government of 2015 to introduce a programme of radical house building.
If trends continue, the report claims, house prices in England will quadruple over the next twenty years, with the average house price exceeding £900,000 by 2034. As more and more people are priced out of owning their own home, it predicts that more than half of 20-34 year olds will live with their parents in 2040.
However, the calculated figures do not take into account mitigating factors such as wage inflation and the market economies of supply and demand. If the prices are beyond what people can afford, there would be no buyers, and prices would therefore drop out of necessity.
Nevertheless, house price inflation is an issue that needs to be dealt with, and could be a deciding factor in the elections next year. Marianne Fallon, UK head of corporate affairs at KPMG, said that “a government which is prepared to roll up its sleeves and commit to a programme to tackle each element of the problem, over a parliament and beyond, has the chance to make home ownership a realistic dream again.”
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