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Media

21 May, 2015

Housebuilding Recovery Gathers Momentum

Government must now deliver on manifesto commitments if increases in build rates are to be maintained   

Official statistics released today show that 40,340 new homes were started in England in Q1 of this year, the highest quarterly number since 2007. The figures show that the momentum from 2014, which saw 137,310 new homes started, up 10% on 2013 and 60% on the trough in 2009, is gathering speed.

Today’s figures from the Department for Communities and Local Government show:

  • The number of homes started in Q1 is 11% up on Q1 2013 and 41% up on Q1 2011
  • 34,210 homes were completed in Q1, the highest number since Q4 2008  

Despite this strong growth in housing output, we are still a long way from delivering the 230,000 homes a year needed in England. HBF is now urging the new Government to prioritise policies to support the increases of recent quarters by giving greater certainty to the industry as it plans investment in land and labour.

As an absolute priority the new Government must formally confirm the extension of the Help to Buy Equity Loan scheme to 2020. Introduced in April 2013, this has helped drive the significant rise in private house building over the last two years and enabled house builders to buy land with considerable confidence about future levels of demand.

With build rates increasing and builders looking to get onto new sites sooner, Government must also address the delays in the planning system so that permissions are processed more quickly, and ensure local authorities have sufficient resources and capacity to deal with the increasing volume of applications. Local authorities must also accelerate the production of local plans, an essential element in our plan-led system. A recent survey suggested only a quarter of authorities outside London and the National Parks have put a plan in place since the National Planning Policy Framework (NPPF) was introduced in 2012.

The government also needs to give early attention to its various brownfield policies. The detailed design of these measures will be the key to further boosting housing delivery. Further assistance to get SME’s building again will be vital if the industry is to be able to deliver the volume of homes required.

Today’s statistics mirror figures released last month by NHBC showing that more than 40,000 new homes were registered in the UK during the first three months of the year, up 18% on the same period last year, with a 26% rise in private sector registrations; with HBF’s Housing Pipeline reports also showing a steady rise in the number of planning permissions being granted in recent quarters. 

John Stewart, Director of Economic Affairs at the Home Builders Federation said:

‘These figures are yet another sign that the house building industry is responding to more positive market conditions, along with the added boost from Help to Buy Equity Loan, to raise housing supply. The last parliament saw the introduction of a range of positive policies that allowed supply to be increased. A combination of improving consumer confidence and the unequivocal success of the Help to Buy scheme has brought about an increase in the realisable demand for new homes, which in turn has allowed the industry to increase output. But despite these increases we are still a long way from delivering the number of homes the country needs. 

‘Significant constraints remain, and if the Government is to deliver on its manifesto commitment to further increase build rates we now need to see more action. Maintaining the Help to Buy scheme to 2020 is absolutely essential, as are policies to increase the speed at which land for housing comes forward through the planning system. Swift action by the new Government will allow the industry to maintain momentum and provide decent homes for thousands more people. Increasing housebuilding will also create tens of thousands of jobs and lead to infrastructure and amenity improvements in every part of the country.”                           

The number of homes started has been gradually increasing since a low point in 2009 following the economic downturn. But, as can be seen from the graph below, this growth in activity accelerated dramatically following the launch of Help to Buy equity loan scheme in April 2013.  

 

--ENDS--

For media enquiries, or to arrange an interview, please contact Steve Turner – 020 7960 1606 / 07919 307760 or steve.turner@hbf.co.uk

Notes to Editors:

  1. The Home Builders Federation (HBF) is the principal representative body for private sector home builders and voice of the home building industry in England and Wales. HBF member firms account for some 80% of all new homes built in England and Wales in any one year, and include companies of all sizes, ranging from multi-national, household names through regionally based businesses to small local companies: www.hbf.co.uk