New home completions fall by 6.5% amid challenging market conditions
The net additional dwellings figures for 2023/24 reveal a 6% fall in housing supply, the drop signals even more troubling trends as other indicators such as planning permissions and Energy Performance Certificate registrations show home builders are struggling to deliver desperately-needed new homes.
The latest annual housing supply statistics report 198,610 new build completions in England for 2023/24. The figure is down 6.5% from the previous year, where there were 21,364 new build completions. The number of new build completions in 2023-24 is 9% below the 2019-20 peak.
Overall, the annual housing supply in England amounted to 221,070 net additional dwellings in 2023-24, down 6% in 2022-23. Net additions are now 11% below their 2019-20 peak of 248,600.
While this recent announcement underlines the significant challenge to reach government’s housing targets, wider indicators predict further falls in supply are still to come.
The net additions data published today captures completions in the year to March 2024. However, EPC registrations and granted planning permissions in the months since the March 2024 predict an increasingly negative picture for home building.
As it stands, the number of units being granted planning permission currently sits at 130,000 fewer than the 370,000 the Government is aiming for.
The figures paint a bleak picture of a continued decline in housing supply overall in the last two years, showing that the industry is feeling the pressure of inflationary economic conditions. Work is needed to reverse this trend and support the industry’s ability to deliver and meet the ambitious targets set earlier this year by the new government.
While the government has taken positive first steps to support home building — targeting 1.5 million new homes over the next five years, reversing previous reforms to the National Planning Policy Framework (NPPF), and announcing plans to recruit 300 new planners —the housing industry faces a range of ongoing challenges.
Moreover, the significant impact of inflation and mortgage affordability on the housing market underscores a critical need for government intervention. For the first time in 60 years, there is no effective government support for homeownership, and without it, many first-time buyers remain locked out of the housing market. The industry is calling for targeted measures that will make it possible for more first-time buyers to access affordable lending and mortgages, helping to address both supply and demand issues in the housing sector.
Collectively, these figures and policy challenges highlight the urgent need for sustained government action to support the housing market and ensure that the industry can deliver the homes the nation desperately needs.
Neil Jefferson, chief executive of the Home Builders Federation, said: “The figures and other, more up-to-date indicators of new housing supply starkly illustrates the scale of the challenge we face if we are to increase housing supply to the ambitious level government is a quite rightly targeting.
“The positive planning policy reforms announced in July were welcome but will take time to come through and the decline in output has been caused by multiple factors that go beyond planning policy.
“It is the first time in decades there has been no support scheme in place for first-time buyers and with only a limited market for new homes there is a very obvious constraint on output.
Jefferson continues: “Delays in the planning process caused by a lack of resources and inefficiency at a local level are a daily feature of trying to build homes while 160,000 new homes remain blocked because of European rules on nutrient neutrality.
He concludes: “If the government can reverse the decline in house building of recent years it will deliver a huge social and economic boost to our communities, but unfortunately the starting point is a difficult one that will require an ongoing concerted effort to address”
The net additional dwellings 2023/24 members’ briefing is available to read now.
