The number of people living in overcrowded homes in England will soar by 15% to 2.6 million within two years as unemployment and repossessions soar during the recession, a leading campaign group warned today.

The National Housing Federation (NHF), which represents England’s housing associations, said an extra 350,000 people would be forced to live in cramped and unsuitable conditions by 2011, leading to widespread problems with health, children’s education and damaged family relationships.

The NHF warned that the situation could get even worse if the recession leads to a sharp downturn in the construction of new affordable homes, with the latest estimates indicating that as few as 70,000 new homes could be built in England during 2009/10 – down from around 140,000 in 2008/9.

There are currently 2.3 million people living in properties officially classed as overcrowded in England , and new research by the Federation predicts that figure will soar to 2.65 million within two years – as a lack of mortgages and rising unemployment forces families to stay in properties that are far too small for them.

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The problem is particularly acute for larger families of five or more people – with 20% currently living in overcrowded properties. But with not enough new family homes being built, that figure is expected to increase sharply over the next two years, with one in four larger families predicted to be living in unsuitable homes by 2011.

But smaller households of three or four people are also increasingly living in cramped conditions – rising from 170,578 households in 2003 to 248,412 in 2008. By 2011, that figure is likely to reach 280,000.

Regionally, the problem of cramped living conditions is most severe in London, where 203,000 homes – 6.6% of all homes in the capital – are officially classified as overcrowded. In the South East, the second worst affected area, 66,000 homes are overcrowded, while the North West has 64,000 properties classed as overcrowded.

As well as having a negative impact on family life, overcrowding can contribute to increased levels of homelessness and put enormous pressure on public services – as families are housed in expensive, and often unsuitable, temporary accommodation.

Nearly 5 million people are expected to be on social housing waiting lists by 2010, while a wave of repossessions could further add to the crisis.

The Government has pledged to build 3 million new homes by 2020, but the credit crunch has seen house building virtually grind to a halt.

NHF Chief Executive David Orr said it is vital that new family homes continue to be built through the downturn – and called on the Government to introduce a house building fiscal stimulus in the forthcoming Budget.

He said: "Living in overcrowded housing can be hugely damaging to family life. It can lead to poor health, depression and puts relationships within the family under enormous strain.

"Unfortunately the recession, with the concurrent rise in unemployment and repossessions, is clearly leading to a sharp increase in the number of people being housed in cramped conditions."

(CD/KMcA)