The number of completed new-build properties and those earmarked for construction may have edged upwards last year, but levels are falling well short of Government targets.
What’s the latest?
The number of new homes being built reached its highest level since 2008 last year – but even this figure continues to fall well short of Government targets.
According to the National House Building Council (NHBC), the warranty provider for 80% of new homes, a total of 147,278 new homes were completed in 2017, an increase of 4% on the previous 12 months.
The number is significantly under the Government’s target to build 300,000 properties a year and down on the estimated 250,000 new homes needed just to keep pace with rising demand.
A further 160,606 new properties in 2017 were registered to be built. That's 6% more than in 2016 and the highest level for a decade.
Across the UK, the number of new home registrations rose in nine out of 12 regions, with the East Midlands and Wales seeing the biggest jumps.
Above: This new-build, three-bedroom detached home in Cardiff is on the market for £282,500
Why is this happening?
The climbing figures are due to a steady recovery of the housebuilding sector since the last recession. The industry has also received a boost from the Government's Help to Buy initiative, with the equity loan part of the scheme only applicable to new-build properties.
However, the country was failing to build enough new homes even before the financial crisis struck.
Despite ambitious targets being set by the Government, such as its pledge to build one million new homes by 2020, a number of factors are still hindering developers. These include delays in getting planning permission and a shortage of suitable land.Above: Priced at £201,995, this two-bedroom flat is for sale in Edinburgh
Who does it affect?
Social housing tenants, and those eligible for Government homebuying schemes, will be at an advantage in 2018 with the affordable housing sector seeing the biggest rise in new home registrations.
NHBC recorded a total of 41,781 properties earmarked for affordable housing, a 14% jump on the year before and the highest annual total since its electronic records began 30 years ago.
By contrast, the number of private sector registrations in 2017 edged ahead by just 3% to 118,825.
Nearly a third (30%) of all new registrations in 2017 were for detached homes, 26% were apartments, a further 26% were semi-detached, 16% were terraces and just 2% were for bungalows.
Sounds interesting. What’s the background?
The Government announced an ambitious target of building 300,000 new homes each year until the mid-2020s in its most recent November Budget.
The Chancellor also pledged £44bn of capital investment and other measures to get ‘building projects started’, including initiatives to speed up the time taken between planning permission being granted and homes being completed.
Extra cash for the Home Builders Fund, which helps small builders access finance, was also promised, while other initiatives put in place included changing planning regulations to make it easier to convert agricultural or industrial buildings into housing.
But, despite all of these measures, and previous drives to boost building levels, the number of homes being built each year still remains stubbornly below the 200,000 mark.
Above: In Oxford, this one-bedroom new-build flat is on the market for £298,000
Top 3 takeaways
- The number of new homes being built reached its highest level since 2008
- But the 147,278 total was still well below the Government’s target of 300,000 a year
- A further 160,606 new properties in 2017 were registered to be built