by Tom McBeth
As prices of homes in Amsterdam continue to rise, is this a local issue or is Europe really suffering from an international housing crisis?
Over the best part of the last decade the Netherlands has struggled with a lack of housing stock and high purchase and rent costs.
Meanwhile in Amsterdam, the unpopular ‘rent control zones’ mean that only one house for every twenty is available to those earning over £35,000 a year.
Overseas, a lot is made of the ‘Englishman and his castle’ and the ‘right-to-buy’ scheme that has run across the country in various guises since the 1980’s.
‘Right-to-buy’ allows tenants of council housing to buy their homes after a certain amount of time for a subsidised and reduced cost, allowing members of the public to own their own home.
David Simmons, Head of Intermediate Housing for Nottingham Community Housing Association (NCHA), explained how governments subsidise the housing marketing in the UK.
“Public money for housing is channelled through the Homes and Communities Agency which makes grants to housing associations, housing organisations and private developers.”
The UK shares many similarities with the Netherlands in its housing stock, with average house prices at around £200,000 across both countries, and prices increasing by as much as 8.3% from July 2015-2016, according to the latest government statistics.
Both also have their figures wildly influenced by the inflated costs in their respective capitals.
In London, house prices average at £484,000, over £280,000 more than the rest of the country whilst rental prices are over twice as much. The average rental price for the UK excluding Greater London in March 2017 according to the annual rental index report from Homelet – a leading Nationwide Letting agency, is £751 pcm, whereas Greater London’s average rental cost is £1546 pcm. This report suggests that this raises the cumulative National average for the UK to £904 pcm.
However, Catherine Stocks, the City Manager for Nottingham City Homes (NCH) who manage over 27,000 council homes in the city, explains how, “affordability in general is an issue, houses in Nottingham are cheap in comparison to UK overall but income is low in the city so housing is still unaffordable.
The issue with ‘right-to-buy’ is that it reduces social housing available in Nottingham and government policies for years have failed to provide adequate replacement.”
We have seen an increase in ‘right-to-buy’ but this is probably more to do with the increase in discount, meaning it’s difficult to tell if affordability of buying a property is becoming more or less of an issue for the average tenant.”
The government’s ‘right-to-buy’ policy means to increasing home ownership, but it gives a subsidy to those ‘lucky enough’ to get council housing and is not necessarily the fairest way to boost home ownership”
There continues to be ongoing and significant demand in Nottingham for social housing and affordable housing, meaning stable tenancies, which we seek to meet.”
David Simmons added that, “although a sale will mean a social home goes out of the sector [NCHA] will use all of the money in building new homes and so replacing the lost unit and adding to the UK housing stock.”