'Paying more for less' – report reveals state of UK housing

The UK’s housing stock offers the worst value for money of any advanced economy, new research suggests.

Analysis by the Resolution Foundation suggests that while the UK may suffer from a lack of supply, the existing stock ranks poorly when it comes to housing costs, floorspace, quality and price levels.

The thinktank said housing represents a greater share of costs in the UK than in any other advanced economy bar Finland.

In theory, these high housing costs could reflect the cost of a superior quantity or quality of housing in the UK, but people instead pay more and get less. 

The report shows that English homes actually have less average floorspace per person (38 m2) than many similar countries, including the US (66 m2), Germany (46 m2), France (43 m2) and even Japan (40 m2).
English homes also have less floor space, on average, than homes in the notoriously cheek-by-jowl New York City (43 m2). Overall Brits get 24% less housing per person than Austrians and 22% less than Canadians, both of whom have similar consumption levels overall.

As well as being cramped, the UK’s housing stock is also the oldest of any of European countries, with a greater share of homes built before 1946 (38%) than anywhere else., the Resolution Foundation said.

For example, just 21% of homes in Italy, and 11% in Spain, were built before the end of the war. Older homes tend to be poorly insulated, leading to higher energy bills and a higher risk of damp, the research added.

The Foundation concludes that high cost and low quantity leave the UK’s housing stock offering the worst value for money of any advanced economy. UK households pay 57% more for the same (quality-adjusted) housing as their counterparts in Austria, for example, and 36% more than those in Canada. Housing in New Zealand offers the second worst value for money, followed by Australia and Ireland – all countries also gripped by housing crises.

Adam Corlett, principal economist at the Resolution Foundation, said: “Britain’s housing crisis is likely to be a big topic in the election campaign, as parties debate how to address the problems of high costs, poor quality and low security that face so many households.

“Britain is one of many countries apparently in the midst of a housing crisis, and it can be difficult to separate rhetoric from reality. But by looking at housing costs, floorspace and wider issues of quality, we find that the UK’s expensive, cramped and ageing housing stock offers the worst value for money of any advanced economy.

“Britain’s housing crisis is decades in the making, with successive governments failing to build enough new homes and modernise our existing stock. That now has to change.”