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New Build Home Rate Falls Despite Election Promises

Government figures show that the number of new homes being built in England has fallen 14% in three months, despite a pledge made during the last election.

The last quarter saw construction begin on approximately 33,200 new build properties, the most dramatic decline since the beginning of 2012, according to government data that is adjusted on a seasonal basis.

The 14% drop in housebuilding output took place in the period from April to June. Year on year, stats are lower by 6%.
Generally translated, these figures indicate that the rate of new housebuilding activity is 32% lower than in 2007, which is when peak levels were attained, but continues to be almost double the plateau it reached in 2009, during the financial crisis.

The decline comes after a remarkable increase of 29% in the first quarter of 2015. It is the biggest activity jump recorded since 2006.

Figures from the Department for Communities and Local Government show that from January to June 2015, the number of new build starts came in at 136,320, which is a 1% decrease on the previous year.

The total number of completed properties was 35,640, which is a 4% increase on the previous period. Year on year, a 22% increase has been reported, but numbers still remain below the peak attained in 2007. In the year to June there were 131,060 completions, an increase of 15% on the previous year.

According to housing charity Shelter, these completions represent only half of the 250,000 homes needed to combat the ongoing housing shortage in the UK.

Campbell Robb, Shelter chief executive, said that the figures are proof positive that the UK is not producing anywhere near the number of new homes required each year, leaving millions of aspiring homeowners priced out. He said that despite government claims that the housing shortage is gradually being corrected, the number of new homes being built has actually decreased.
Part of the problem may be lack of skilled workers.

A report issued by the Federation of Master Builders indicates that 66% of smaller construction companies have had to turn down business because of the current skills shortage. There are not enough roofers, bricklayers, and other tradespeople to accommodate the demand.

The leaders of the country’s biggest construction firms, such as Persimmon and Barratt Developments and other FTSE giants, warned that problems with recruitment is holding back the construction of new properties.

Specialists in Construction Insurance

During the general election campaign, David Cameron promised that there would be 200,000 new homes built every year by 2017. He also pledged to see 200,000 starter homes completed by the time parliament ended.

Housing minister Brandon Lewis said that the UK government is making real progress in solving the housing crisis. He cited the figures showing that 131,060 new homes had been built in the past year.

“This has provided a real boost to the UK’s construction industry and is delivering the homes that hardworking people rightly deserve,” he said.


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