12.3% rise in Bexleyheath Property Values adds weight to the Housing Crisis

Like elsewhere in the UK, Bexleyheath’s continuing housing crisis threatens the country’s reputation as a nation of homeowners. The number of houses being built remains woefully inadequate in meeting the needs of the growing population in the suburb. 

At a recent family get-together, my parents and I started talking about the local property market, a topic that often comes up at family parties, right after the weather and politics. They said that once, if you went out to work and planned sensibly, you would be able to buy a house quite early in your career, along with being able to take a holiday every year and saving for a pension. Today, things seem to have changed.

Chancellor 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. He also introduced a series of initiatives to help get first time buyers on the housing ladder, including the contentious Help-to-Buy Scheme and the extension of the Right-to-Buy scheme to housing association as well as council tenants.

That all sounds good, but Britain is still only building 137,490 properties a year (114,250 built by private builders, 21,560 built by Housing Associations and a paltry 1,680 to serve as council houses). If you look at the graph (courtesy of ONS), you will see that the last time the country was building 230,000 houses a year was in the 1960’s.

I don’t know how George is going to almost double house building overnight. If we use a greengrocer shop as an analogy, consider that if people want to buy more apples, giving them more money doesn’t really help if there aren’t enough apples in the shop to begin with.

Looking at the Bexley Borough house building figures, only 590 properties were built in the last 12 months. Of those, 510 were privately built and 80 by housing associations. Not even one council house was built. This is simply inadequate. The shortage of supply means that local property values have continued to rise. They are 12.3% higher than 12 months ago, and have risen 1.5% in the last month alone.

All those years ago at school, I was taught about the economics game of supply and demand. The demand for Bexley Borough property has been very strong. My considered opinion is that it is likely to continue this year, driven by growing demand from buyers (homebuyers and landlords alike). Our borough’s economy is quite varied, so activity is expected to remain relatively strong into the early summer of 2016, especially as some Bexley Borough buy-to-let landlords rushed to complete purchases ahead of the introduction of new stamp duty rules last month.

With respect to supply, we have spoken about the lack of new building in the area holding things back, but that is not the only issue. Of existing properties, the concern is the number for sale. Last month in Bexleyheath there were 193. 12 months ago, that figure was 258. Three years ago it stood at 586. We’ve seen a massive drop!

With demand for property rising, few 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.

For more articles like this, please visit the Bexley Borough Property Blog www.bexleyproperty.co.uk You’re also more than welcome to give us a call on 01322 559955 or pop in for a chat. Our office is located in the heart of Bexley Village (next door to the King’s Head Public House).