Norwich has recently been named the fifth fastest growing city in the UK and if you’ve spent any time here in recent years this will come as no surprise. However, it’s also true that only 1,420 new homes have been built in the last five years. So is the supply going to be able to keep up with the demand, and just what does this mean for investors in the area?
With just one new home being built for every six new residents in the city, things don’t look all that positive. But when you compare this number with that of Belfast, the UK’s fastest growing city at just one home for every 23 residents, it looks like things aren’t so bad in Norwich.
In the five years from 2011, the city’s population grew by around 8,500 people, during which time only the 1,420 homes were built. But then of course, every new home is capable of housing more than just one person. If you consider that an average home could accommodate four people, then the numbers don’t look so difficult.
Around the country, cities which are growing quickly are all facing similar problems. Coventry has expanded by around 35,000 people in the same time period but managed to create only just over 5,000 new homes. That’s just one home for every five new inhabitants. London grew by around 613,000 people, and created 124,000 new homes – a rate of about five to one.
Paul Le Grice, managing director of Abel Homes, which constructs property in the Norfolk area, said: ‘It is not just a case of needing to provide homes for everyone, vital though that is. Infrastructure such as schools and doctors’ surgeries need to keep up as well; increasingly we will need to view development as a holistic process.’
He added: ‘At the moment, the slowness of the planning process means that we are not keeping up with where we need to be, as these figures show. There is a definite lag between housing need and housing delivery; even now there is a lot of land in either the planning or construction process that will deliver many more homes in the next few years. Demand for new homes in the county will continue to grow, due to many factors: not just people moving to the county, but young single people seeking their own home, partnership break-ups, people living longer, and smaller household sizes – these all play a part.’
But for investors, this shortage of supply could be good news. Basic economics dictates that a shortage of supply will see house prices continue to rise. Which is one of the main reasons Norwich is so appealing.
To find out more about the local and national property market, or if you would like to chat about anything to do with property investment, give us a ring on Norwich 01603 567804 or send us a message.
For more free tips on Property Investing SIGN UP HERE.