Affordable housing in Wales

Housing is an essential human right that forms the foundation of strong communities and a competitive economy – stable, good quality housing supports the physical and mental wellbeing of residents and enables them to contribute to society. However Wales, alongside the other British nations, is facing a housing crisis. This has been caused and perpetuated by a number of factors, but the ongoing under-delivery of new homes lies at the heart of the problem. More recently, this has been compounded by higher interest rates, increased construction costs and greater regulatory costs. The impacts of the housing crisis are far ranging: including homelessness affecting those worst affected, a detrimental impact on health and wellbeing affecting those without access to good quality housing that meets their needs, and undermined social and economic inclusion for those that are forced to pay a disproportionate amount of their income on housing costs.

The severity of this crisis is recognised by Welsh Government which has an admirable ambition to facilitate the delivery of affordable housing and support those most in need. However this Insight Focus concludes that the strategy to date, to deliver 20,000 low carbon social rent homes during this five year term from 2021 to 2026, has not increased affordable housing rates to the level needed to make a meaningful contribution to tackling the housing crisis.

Looking ahead, the recent election of Wales’ current First Minister, Eluned Morgan alongside a new Cabinet, presents an opportunity for Welsh Government to reconsider its approach to increasing affordable housing delivery. This opportunity is particularly prevalent in light of the outcome of the General Election in England, and the increasingly apparent misalignment in how the two Labour Parties approach increasing housing delivery, and the wider benefits of housebuilding which would contribute to the Wellbeing of Future Generations.

The opportunity that exists to reform the planning system is explored in detail in a wider series of Insight Focuses, but this piece identifies specific issues to affordable housing delivery.