“Fewer households will ‘reduce need for new homes’ “

Will the number of extra houses predicated for the Greater Exeter area (57,000] be reduced in line with these new findings? Of course not – develipers rule, OK!

“There are likely to be 1.4 million fewer households in England by 2041 than the government originally thought, a forecast that economists warned yesterday could have a big impact on housebuilding targets.

The Office for National Statistics said that the number of households in England was projected to grow by 159,000 a year, from 22.9 million in 2016 to 26.9 million by 2041.

The figures are used by the government to work out future housing needs and have been a key reason for its target of building 250,000 to 300,000 homes a year.

This is the first year that the projections have been calculated by the ONS rather than by a government department.

A large proportion of the growth will come from the rising elderly population. Households headed by someone aged 65 years and over are set to account for 88 per cent of total growth between 2016 and 2041. The highest growth is set to take place in London and the lowest in the northeast.

However, while this overall 17 per cent increase in households may seem large, it is significantly smaller than the projection made in 2014. Then, the government said that there would be an extra 210,000 households a year in England, resulting in 28 million homes by 2041.

Bidwells, a property consultancy, said that the latest projections would lead to a dramatic drop in the required number of homes in England.

Ian Mulheirn, director of consulting at Oxford Economics, said that the drop in projections demonstrated that there were several myths around Britain’s housing shortage and argued that it was not necessary to build 300,000 homes a year.

“Over the last 20 years, the various housing departments have used a methodology to predict household need that was flawed,” he said. “It predicted that a significantly higher number of households would form and it was consistently shown to be incorrect at each census point.

“The ONS has changed the methodology and if we had used their figures over the last 20 years we wouldn’t have this figure of extremely high housing need being quoted everywhere.”

Previous projections made by the government were based on census data starting in 1971, which showed household sizes steadily shrinking as more people chose to live alone or to have smaller families. But this trend stopped around 2001, which is when the ONS is now basing its projections from.

The latest figures were disputed, however. Matthew Spry, senior director at Lichfields, a property consultancy, said: “The number of households that have formed can only ever match the number of dwellings that there are for people to live in. Statistically a household cannot form if it doesn’t have an extra house to form into.”

The ONS has also made a new assumption for net migration. It is now projected to be 152,000 a year from mid-2023 onwards. The 2014 projection had assumed 170,500 a year.

Joanna Harkrader, of the Office for National Statistics, said that the slower growth reflected “lower projections of the population — notably assumptions around future births, how long we will live and migration — and more up-to-date figures about living arrangements, such as living with parents or cohabiting.”

Source: Times (pay wall)