Blog: 10 February 2017The White Paper and Immigration

James Donagh

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James Donagh

Development Economics Director

Kings Hill office

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Sajid Javid is saying that future population growth is not the root cause of the housing crisis, and we agree.   The housing crisis is the result of over a decade of persistent undersupply, that has caused a spiralling affordability problem, supressed household formation and created backlog need. These issues need to be addressed by a significant boost to supply, up to 275,000 homes a year according to the White Paper; to moderate house price inflation and help price families back into the housing market.

So even if we had no migration, the crisis remains, and the White Paper makes this clear in its introduction. But given it is very unlikely that we will have no migration, how much affect migration will have is yet to be seen or commented on by the Government.

Latest estimate puts net migration at 335,000 year ending June 2016, the main reasons being to work, to study and to join family members; EU migrants mainly to work, non-EU mainly to study.

The average level of net international migration observed over the last 10 years is +250,000 persons per annum; the level projected by the 2014-based is +185,000 per annum. Even if net international migration is 'controlled' below recent levels (in excess of +300,000 per annum), there is nothing to indicate that it will fall below the range of 185,000 to 250,000 per annum.

In European context, UK has recovered well from recession and has reasonable growth prospects. Pre-referendum surveys underline that the UK remains an attractive place to come and work, look for work, and study. Post-referendum, the relative strength of UK economy and attractiveness as a place to do business, coupled with an ageing UK population and low unemployment, look to be a major pull factor for the foreseeable future.

There are many uncertainties at the present time over the future implications of Brexit to the housing market, and wider economy. However, the significant need to plan for a greater supply of new homes remains, and it is clear that any curbs which may be placed on the movement of people will not reduce that need to any great extent.

Posted with the following keywords:
Housing White Paper, Immigration, Research, Migration, Population Projections, Development Economics