Nearly 600 additional low-cost rented homes need to be built every week in order to fix the broken housing market and help low incomes families escape poverty, Joseph Rowntree Foundation (JRF) has found.
Government plans will deliver less than 100 new low-cost rented homes a week, one-sixth of the extra supply needed – a level deemed to fall far short of the number required.
Unless the government ramps up the supply of low-cost rented homes, England will see a shortfall of 355,000 affordable homes by the end of the Parliament.
Campbell Robb, chief executive of (JRF), said: “The Prime Minister has recognised that the housing market is broken and it’s welcome that the government wants to get the country building the homes we desperately need.
“But this must include homes that people on low incomes can afford. The government’s existing plans risk falling far short of the numbers of affordable homes required to ease the strain on families facing eye-watering private rents.”
78,000 low-cost rented homes are required in England every year to meet demand, or 1,500 every week. But on average 47,520 affordable homes have been built in England each year since 2011, leading to a shortfall of 182,880 homes over the last six years.
It means 577 new affordable homes are needed every week to make up the average 30,000 shortfall.
If this rate continues, the shortfall will reach 335,000 by 2021/22 and will result in more people struggling to make ends meet because of their housing costs.
JRF is calling on the government to use its forthcoming Social Housing Green paper to commit to building 78,000 affordable homes a year so more families can enjoy a decent and secure life.
Doing so would ease the pressure on families trapped in the expensive and insecure private rented sector.
Robb added: “Voters across all wage brackets want to see action on housing and it is simply not right that so many people in our country are locked out of the opportunity to build a decent and secure life because of crippling housing costs.
“The forthcoming social housing green paper must commit to increasing the supply of low-cost rented homes. The government can start by building 78,000 genuinely affordable homes a year. By fixing our broken housing market, we can help release people from the grip of poverty.”
The government has made some steps in the right direction, like announcing an additional £2bn of investment in 2017. However, it is only expected to deliver around 5,000 additional social rented homes each year – less than 100 a week.
Private rents are unaffordable for low earners in over half (53%) of the country. In 171 out of 323 English Local Authorities even the cheapest rents are unaffordable for residents in the bottom 25% of local earnings.
In these areas, the cheapest 25% of rents would cost people on low wages more than a third of their earnings every month, a common measure of housing affordability.
The London Borough of Westminster has the most unaffordable rents, at 79% of the pay packet of a low-paid resident, followed by Kensington and Chelsea (77%). Monthly rent-to-earnings ratios run at over 40% in much of the South.