Understanding the unmet demand for affordable homes and the growing role of private capital in new development.
- Emma Rosser
- Richard Petty
Over the past two decades, affordable housing supply has remained roughly static, hovering around 4m homes in England. New development gains have been largely offset by social housing sales and traditional providers face various competing challenges alongside delivering their pipelines.
However, there is also a significant unmet demand. For every four households in affordable housing there is one on a local housing register waiting for accommodation. JLL estimates the real need at 6.2m, reflecting 2.2m households that do not have the homes they need.
Private capital is responding to this challenge. At the end of 2022, there were 26,400 affordable homes owned by investors. Projections and current delivery rates will see institutional ownership double over three years, rising to 58,100 homes by the end of 2025. Yet it will still account for a small portion of the market, rising from 0.7% to 1.4% of affordable homes, or just 0.9% of the true demand.