North-east reels under growing demand for homes

The North-east is facing a housing crisis as a result of spiralling house prices, rising levels of homelessness and existing clearance programmes.

In its draft regional housing strategy for 2005/6, launched on 17 December, the North-east regional housing board said the nature of housing demand had changed substantially over the past two years.

As a result the report warned the region’s housing professionals against concentrating solely on the problem of low-demand housing and said more attention should be paid to expanding the provision of new housing.

Bill Fullen, chief executive of Gateshead Housing Company, which manages 23,500 homes, said: “We have seen a significant change in the last two years in demand. If we decided to demolish somewhere, those affected have to be rehoused and most people would require council housing. If we have an increase in homelessness, our ability to deliver becomes much more restricted.”

The replacement rate of 4000 units per year up to 2011 is likely to cost between £40m-60m, with replacement affordable housing adding a further £20m.

Clearance proposals will be reviewed in some areas in light of the changing conditions, the report states.

Four local authorities in the region – Wear Valley, Newcastle, Blyth Valley and Durham – have seen house prices rise in excess of 80% over the past four years.

Tony Stephenson, head of the North-east regional housing board, said: “Supply issues are very sensitive in some parts of the region and have to be handled carefully.

“It may be that in order to kick-start a so-called clearance programme, the first thing we may need to do is build a few new houses in order that we have somewhere to decant people to.”

Greg Stone, executive member for development and regeneration at Newcastle council, said: “Five to six years ago we had street after street of empty properties. I think the ground has moved.”

The strategy was published as the House of Commons ODPM select committee launched an inquiry into empty homes and the government’s nine low-demand pathfinders.

The inquiry will pay particular attention to the scope and scale of the initiatives proposed (and now under way) in the government’s housing market renewal pathfinder areas and other areas with problems of empty homes; whether

councils have sufficient powers to tackle the problem of empty homes; and the priority given to the demolition of homes and the consideration given to effective methods of refurbishment.