Four million new homes 'needed by 2020'

Posted: 23 Jun 2006 11:09:41 GMT

            Property News - Four million new homes 'needed by 2020'

The government has been warned that four million new homes are needed in England by 2020 for the benefit of the economy.

According to Sir Digby Jones, director general of the Confederation of British Industry (CBI), more housing is crucial if house price inflation is to be kept stable, which will in turn ensure that first-time buyers are able to access the market.

Sir Digby argues that homeownership has the potential to become "socially divisive" if price growth is not kept under control and he suggests that four million new homes could provide the solution.

Speaking at the Chartered Institute of Housing's Annual Conference and Exhibition, Sir Digby claimed that the ratio of house prices compared to annual earnings had increased from 4.5:1 in 1976 to 7:1 today and he suggested that this is unsustainable.

If enough houses are to be built to curb this problem, another 350,000 people will need to join the construction industry, according to recent predictions.

Sir Digby insists that this will only be achieved if we "drive up the aspirations of teenagers into vocational skills" to fill this skills gap.

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