Mayor of Cambridgeshire and Peterborough James Palmer has made finding new, innovative solutions to tackling the housing crisis one of his key priorities. The lack of affordable housing is one of the major factors affecting quality of life in the area, which also harms the economy and threatens everyone’s future prosperity.
Homes have become progressively less affordable over the last 25 years. The success of the Cambridgeshire and Peterborough economy, coupled with not building enough homes, has driven up the cost of housing. But average wages have not increased by the same levels, meaning getting on to the property ladder has become much harder for more people. For example in Cambridge and South Cambridgeshire, 2016 house prices were between 10 and 13 times average incomes. In the late 1990s, house prices were only three to five times average earnings.
Source: Cambridgeshire and Peterborough Independent Economic Review, 2018
People are forced to move away from areas of high growth to areas where housing is less expensive. But this means people live further from the places where they work or have strong community connections. This results in longer commute times, extra pressure on already congested roads and public transport, and reduced quality of life. People moving out also displace people in existing communities. A ‘displacement cycle’ can take effect which puts more pressure on housing and infrastructure as well as community cohesion.
Businesses, public services like hospitals, schools and local councils may struggle to attract the staff they need. If the region becomes too expensive to live and work, businesses and vital public services will find it difficult to attract the people they need to fill jobs. With lost productivity, the region becomes a less attractive place to invest, threatening future economic prosperity.
Key documents about the future of our economy highlight the housing risk. The Cambridgeshire and Peterborough Independent Economic Review (2018) and the Cambridgeshire and Peterborough Local Industrial Strategy (2019) both highlight the risk to the future of the local economy by the lack of affordable housing and the need for urgent solutions.
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