Property slump will 'exacerbate homes shortage'
The ongoing property downturn is likely to exacerbate the shortage of new, affordable houses for sale in London and across the UK.
That's according to John Slaughter of the Home Builder's Federation, who noted that as the market slows builders are likely to scale back development projects.
While that will enable construction firms to minimise their losses, the ultimate result will be that when the market does pick up again the chronic shortage of new homes will be even more apparent.
"If the market slows and there is less output in the short-run, when the market recovers that unmet demand will still be there and the overall backlog of demand is likely to be greater rather than smaller," Mr Slaughter explained.
He concluded: "We have an underlying issue of undersupply for some time and the current situation is likely to exacerbate that."
The government has set a target of building 240,000 new homes every year by 2016, but many analysts have raised doubts about the viability of meeting that goal.
Published 2nd June, 2008
© 2008 Estates IT Limited
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The ongoing property downturn is likely to exacerbate the shortage of new, affordable houses for sale in London and across the UK.