Housing supply warning for government
05 August 2003
The Council of Mortgage Lenders has warned the government that the shortage of housing in the UK remains the most critical unresolved issue in UK housing policy.
The CML states in its response to Government's review of housing supply, that without a substantial increase in the supply of housing, the current problems of lack of flexibility, lack of responsiveness and failure to absorb increases in demand will remain significant causes of volatility in the UK housing market.
Peter Williams, CML Deputy Director General, said: "Despite continuing house price rises, the supply of new homes has remained broadly static for a decade. There would need to be a huge increase in housing supply to really make a difference to the number of transactions and the stability of house prices.
The CML claims that there are hot spots in all the countries of the UK, but stresses that supply problems are worst in England.
Mr Williams added, "Even a dramatic increase in supply would not completely prevent house price surges - a major reduction in interest rates, or a new tax relief could also stimulate demand. But although an increase in supply would not solve all housing problems, it is the single most important - and complex - factor to be addressed.
"Lenders look forward to helping to find new solutions for this old problem as the review progresses."
The Council of Mortgage Lenders represents banks, building societies and other lenders who together undertake around 98 per cent of all residential mortgage lending in the UK.