“Home ownership is good, but some people will never be able to own a home” – Network CEO argues
Helen Evans, Network Homes’ Chief Executive, told a Labour Party Conference fringe meeting on Tuesday evening that there is a proportion of the population who will never be able to afford home ownership and government housing policy should be flexible enough to support the needs of these people.
Speaking at a Smith Institute organised event on ‘Confronting the Decline in Home Ownership’, Helen Evans said: “Network Homes believes in the value of home ownership in this country. Last year, Network built 239 homes for market sale and another 320 for shared ownership, as well as 381 homes for affordable rent.
“However, not everyone has the income or the income security to become a home owner. For some, home ownership would be an impossible dream or, if ever achieved, a precarious state. I understand the natural aspiration for security and the desire to build personal assets, but home ownership does not deliver security or, necessarily, a sustainable asset if people are unable to afford the mortgage regularly and cannot properly maintain their home.”
She said: “It is difficult to point to any developed country in the world where the rate of home ownership has been sustained much above 70% of households. In the UK, home ownership peaked at 71% in 2003 and has fallen back to under 64%. The simple fact is that house prices have risen by 2.6% a year after inflation on average since 1998, while real incomes have risen by just 0.8% a year. Overall, real house prices have risen 112% in that time, while real wages have gone up just 15%.
“If the disparity between house prices and incomes is growing on average every year, encouraging more people to buy a home can only be one part of the housing solution. Marginal owners are not secure or comfortable home owners.
“Network has always believed in co-operating with the policies of the elected government – we are playing our part as one of the leading housing association developers in the country, including building substantial numbers of homes for sale. But it’s important that the government also gives full consideration to the people who will always need to rent, many of them requiring a level of subsidy to afford that rent.
“We have had some gentle hints of a broader and more flexible housing policy from the new May administration, and we would like to see the Chancellor follow through on these in November’s Autumn Statement.
“With increased investment from government and more flexibility around tenures in the way the money is used to build new homes, we can begin to tackle the housing crisis and create a housing market which is fit for all of our people, rather than just some.”