According to research from Lloyds Banking Group, demand for homes in the South continues to surge with house prices in the area climbing by 12.4% since the pandemic started. However, this increased demand and lack of available housing has resulted in almost three quarters of Southerners (74%) agreeing that the housing market is currently not helping people access affordable and quality homes in their region.
The top concerns from Southerners include unaffordable house prices (69%), high deposits (46%) and the lack of social housing being built (48%). Other considerations include economic issues caused by the pandemic (46%), too few houses being built (46%) and a lack of rental properties (41%).
Challenges for the industry
Across the South, both homeowners and renters agree that house prices are the biggest issue facing the market and are sceptical that the industry can adapt and deliver the affordable, quality homes needed to accommodate the increased demand from those looking to live here.
With the average house price now at almost £385,000, those in the South believe issues around affordability are likely to get worse with more than two thirds (67%) believing house prices will continue to increase over the next three years.
Beyond affordability, many respondents suggested that new homes in their local area aren’t being built in places where people want to live (35%) – with nearly half of those in the South (46%) frustrated that new homes aren’t meeting the needs of the local area.
Michelle Blayney, Lloyds Banking Group’s Ambassador for the South East, said: “House prices and transaction volumes, even among first time-buyers, have grown significantly during the pandemic. However, this research also shows that many people in the South consider the continued strength of prices as the biggest factor preventing people from accessing quality and affordable homes.
“At the same time the pandemic is reshaping what we want from our homes, yet many people in the region feel that the location and specification of current homes being built does not meet the needs of their local communities.
“Understanding these local trends, will be vitally important in ensuring the homes being built keep pace with the changing needs of individuals and local communities. That’s why, as part of our commitment to help Britain prosper, we are working across the industry to collectively work-out how we deliver high-quality, sustainable and affordable homes that the South needs.”
Meeting local needs
Over the last year, there has been increased interest in the region as homeworking buyers and renters look to spend lockdown savings in rural and semi-rural locations. People in the South said that living in an attractive area (51%), good transport links (43%) and being close to family and friends (41%) were the most important factors to them when purchasing a house.
A changing picture of home
However, when it comes to our homes themselves, more space and outdoor living looks set to be one of the most important factors driving buying decisions in the South over the next few years. The garden was deemed the most important feature; with more than two thirds (40%) stating they would prioritise that first, followed by more living space (36%) and more efficient heating (31%). In fact, just over a third of those in the South said they would pay more than they would otherwise for a home with a garden (39%) and off-street parking (38%).
Durkan, one of London and the South East’s leading housebuilders, is an example of an agile regional builder that has adapted its approach to meet people’s changing needs.
Ronan Murphy, CEO of Durkan, said: “We understand the challenges of meeting these housing needs. As a regional housebuilder, we recognise that it is not just about building at pace, but also about being flexible to deliver the right, high quality and affordable homes that create communities where people and families thrive.
“Feedback from our customers mirrors Lloyds’ research and we’re seeing that, as a result of the pandemic, people are asking for more from their homes. Buyers are looking for spaces where they feel comfortable both living and working.
“It is this intelligent house building that is needed now more than ever. Developers must react to these changing demands and take the time to really understand what people want. We have the flexibility to respond to evolving local needs and create more bespoke homes that are in keeping with existing communities. This is the agile approach that will deliver the homes people want to live in and will also see value in buying.”