Young people are reportedly being priced out of rural communities by soaring housing costs. Official statistics for England show that affordability in rural parts of the country is worse than in towns and cities, excluding London. In 2021, even the cheapest houses in rural areas cost around 9.2 times more than the earnings of the lowest paid workers. In urban areas, it was eight times more.
Since Brexit, there has been a rise in the number of landlords transferring long-term rental housing into short-term lettings on platforms like Airbnb, in a bid to cash in on the growing staycation market. COVID has increased the appeal of rural living, with more people buying second homes. Affordability has worsened since 2020.
These recent pressures have accentuated the decades-old trends of general counter-urbanisation and demand for rural homes that my colleagues and I discuss in our 2022 book, Village Housing.
A combination of planning constraint and external demand pressures, focused on the smallest villages and hamlets, is driving land price expectation and making it difficult to build affordable homes. Land values belong to the communities that create them. A way needs to be found of fixing the cost of land at a price that supports the delivery of affordable homes in rural locations.
Upward pressure on land price
Rural planning authorities largely operate according to the rationale that housing and service needs can more effectively be met in towns than in the countryside. They generally respond to increased housing demand in rural areas by allocating sites in service centres and larger towns for new development. They also fix policies in local plans that require the inclusion of affordable homes in market-led schemes.
Far less gets built in villages. There, the existing stock is gradually sold as investment opportunities to wealthier incomers or to seasonal and weekend residents. This dynamic places upward pressure on land prices.
In those few instances where sites for market development are allocated in smaller villages, land price soars. The resulting housing is high end and unaffordable to local people.
