House building firm Redrow has recently warned that we could face an imminent house availability crash, as the Help to Buy scheme loses its momentum.
The chairman of the company, Steve Morgan, said at Redrow’s Annual General Meeting recently that the demand for homes through the Help to Buy scheme dropped over the summer, resulting in a more normal trade rate.
Sales rate per outlet per week dropped to 0.65 for the company in its regional businesses, whereas 2013 saw an abnormally high rate of 0.87.
“During the last ten weeks we have experienced a traditional autumn market and the sales rate, excluding London, was 0.68, in line with last year,” Morgan said.
The biggest issue facing the house builders now is acquiring planning permission. Morgan explained, “Obtaining detailed consents and clearing countless unnecessary conditions remains a significant constraint on new outlet openings and growth,” and he also postulated that next year’s general election will have an effect on how easy it will be to acquire permission to build.
His speech indicates that house availability could well fall even further, as new builds will become harder to have built. As the Help to Buy scheme loses momentum and less homes are available for people, it could become ever harder for first time buyers to get onto the property ladder. The housing market still isn’t giving us a break.