Immigration And The Demand For Housing

Huge impact of immigration on the demand for housing

Nearly two thirds of additional households since 1997 headed by an immigrant

The impact of immigration on the demand for housing in the UK is much greater than the public realise. That is the thrust of a paper issued by Migration Watch today.

Nearly two thirds of the households formed in the United Kingdom since 1997 have had a foreign-born (immigrant) head of household; that is 1.8 million out of 2.7 million.  Not all members of those households will be immigrants, and other households will include immigrants, but, broadly speaking, immigration has accounted for about two thirds of new households since 1997. The numbers are even higher in recent years.  In the last ten years, between 2005 and 2014, an annual average of 133,000 additional households were headed by a person born overseas.  In the last five years the average was 115,000 (78%), compared with 32,000 headed by a person born in the UK (22%).

If each additional immigrant household over the last ten years had been provided with a new dwelling we would have had to build the equivalent of 133,000 homes a year – that is over 360 a day or one every four minutes[i]. With current levels of building at around 140,000 a year and the number of new homes needed at around 250,000[ii], this shows clearly how the shortfall in the construction of new houses is largely due to increasing pressure for housing as a result of mass immigration.

The precise impact on housing demand will be influenced by other factors than immigration – market forces, the need to replace inadequate housing and changes in the number of shared households. Nevertheless, immigration has made a substantial impact on the demand for housing and must have contributed to driving up both house prices and rents[iii].

Recent official projections of future household growth have been deafeningly silent on the issue.    Our report shows that almost 80% of additional households in recent years have been headed by an immigrant. On present trends immigration will continue to be a major factor in housing demand.

Commenting, Lord Green of Deddington, Chairman of Migration Watch, said

“Communities all over the country are being asked to accept new housing developments without being told that, across the country, most of the additional households are nowadays due to immigration. It is surely obvious that, a major reduction in immigration is essential to reduce the acute pressure on housing which we are now facing.  We call for the government to publish an official estimate of the impact of immigration on housing demand – past, present and future. This has to be a key part of any informed debate about both immigration and housing.”

[i] This is not to say that the majority of newly built homes go to households headed by immigrants, as explained in paragraph 18 of the paper

[ii] The figure of 250,000 comes from the Barker Review of Housing Supply carried out for the government in 2004. This target has never been met, leading to Shelter pointing out that since the review the cumulative shortfall in private housing is now well over a million homes.

[iii] There is wide variation in the size of immigrant households but on average their average household size is greater and they are more likely to live in overcrowded conditions. So, person for person, immigrants have required less housing than the UK born. However, the data presented here relates directly to the number of households and thus takes that into account. For example, a house containing a large number of young Eastern Europeans is one household in the Labour Force Survey; as is one person living alone.

Read the full briefing paper here:

29th April 2015 - Housing

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