As policy makers and commentators continue to pursue the wrong policies; make unsubstantiated claims and are oblivious to evidence, lets reiterate some important points.
1) Housing supply has more than kept pace with household formation.
2) Household projections have been based on flawed evidence resulting in over-estimates of new housing numbers.
3) House prices rises are largely a response to low interest rates and cheap mortgages.
4) House price rises can also be attributed to investors, bidding up house prices as did the boom in ‘rent to buy’ purchases.
5) In real terms cost of housing for both renters and owner occupiers has fallen over the past decade, and is about the same as it was 20 years ago.
6) Ownership levels have fallen due to a first-time buyer mortgage drought with greater restrictions on affordability checks and caps on high loan-
The real problem with the housing market has nothing to do with a lack of housing but relates to limited social housing and a rental sector where greater insecurity is a major problem.
Government policies on welfare and austerity have also weakened the capacity of many to compete in either the rental or owner-occupier markets.