A new report released today, based on research carried out by Lichfields for the Home Builders Federation (HBF), shows the huge contribution house building is making to the Cambridgeshire & Peterborough economy. The 4,203 new homes built in the combined authority area over the last year, generated over £713 million of economic activity alongside a broad range of additional social and economic benefits including local jobs and contributions towards infrastructure provision.
However, the report also highlights that the area is missing out massively on further investment and benefits as it is not building anywhere near the number of homes actually needed by its communities. The Non-Statutory Spatial Framework identified a target of 5,000 new build houses per year, whilst the area lags well behind the UK average increase in housing supply of 78% since 2012, delivering just a 34% increase.
As well as being a major employer and supporter of local supply chain businesses, new developments make significant contributions towards local infrastructure and amenities through development taxes. The benefits that house building brings are major. The report shows that in 2017/18, house building in the area;
- Supported over 13,000 local jobs
- Delivered over £713 million of economic activity
- Generated over £50m of tax, the equivalent of employing an additional 2,148 new police constables or 2,289 newly qualified nurses
- Delivered over £3.3m of spending on new and improved schools, the equivalent of employing 143 additional teachers, or funding 721 additional primary school places
- Generated an investment of over £116m in new Affordable Housing
The report also underlines the impact the Government’s Help to Buy scheme is having in the region. Over 4,100 properties have been purchased using the scheme across Cambridgeshire & Peterborough since its launch in 2013, with 79% of those purchases coming from first time buyers. This is 2% less than the national average.
Since the scheme launched, home building has increased by 118% in Cambridge. Huntingdonshire delivered a massive 67% increase in housing over this period, followed by 39% in Fenland. A decrease was shown in Peterborough and East Cambridgeshire.
Stewart Baseley, Executive Chairman at the Home Builders Federation, said; “For too long the vast social and economic benefits of house building have gone unnoticed in our communities. This research shows that the home building industry is delivering much more than bricks and mortar and by working with local authorities, it is helping to provide a massive economic boost to the Cambridgeshire and Peterborough region. Over the last five years house building has given the economy a £713m shot in the arm and provided much-needed additional funding for local schools and community facilities.
If the area increased house building to the levels actually required it would reap the additional benefits. Building much needed homes provides significant social and economic benefits both for new and existing residents.”
If the Government’s target of building 300,000 homes per year was achieved it would mean an extra 930,000 jobs created across England, and a massive £8.32bn pumped into new affordable housing.
Housing is inextricably linked to the wider health of the economy and it is often referred to as a key barometer of national economic performance. But it is also important to recognise that it also has a range of significant effects on economic performance at regional and local levels too. In particular, house building:
- Drives regional economic growth through its vast and varied supply chains and contracting relationships;
- Generates unrivalled investment multiplier effects with very little import leakage due to the extensive use of local and regional suppliers and services;
- Delivers real jobs both on-site and off-site in associated trades, such as cement production and brick manufacturing, as well as in research and development fields looking at technological innovation areas such as Modern Methods of Construction;
- Creates economic value through new residents as they spend money on goods and services in the local economy;
- Supports labour market mobility wellbeing by enabling local people to move jobs freely and achieve their economic potential;
- Enhances “place competitiveness” and local economic development by improving the perceived competitiveness of specific locations and reducing the costs of mitigating social and environmental problems associated with poor or insufficient housing.