A government review into the housing situation has suggested that the solution to the supply shortage could be to commit to custom and self-built (CSB) houses on a large scale.
The MP Richard Bacon took on this review, and the findings suggest that the minimum level of demand for CSB houses is 30,000 per year, but it may be closer to the region of 100,000 per year. The government has already introduced an equity scheme called Help to Build that is set to lead to the construction of up to 40,000 of these houses per year.
However, the report is arguing that such a number could still fall well short of what is needed to address the housing supply shortage. According to FT Adviser, it then goes on to say that:
“This is also reflective of the general population survey evidence and would also be more in line with what occurs in other developed economies across the world which suggests demand as high as 120,000 homes a year.”
The report also points out that this method is the one most frequently used to meet housing demand in other countries, such as Germany, where it accounts for 55% of all of the new houses built each year. It then adds that the mortgage market for CSB homes is dominated by small building societies, and it has fewer loan defaults than other areas of the market.
Every mortgage advisor who has done CeMAP will want a solution to the supply shortage, so they can better meet the needs of their clients.