Number of new homes from UK housing associations fall but outlook is positive

The number of new homes in the UK started by housing associations increased by 13% to almost 48,000 in the 12 months to April 2017, according to the latest data to be published.

Out of these some 38,000 were completed, according to the figures from the National Housing Federation’s latest survey which covers 82% of developing associations.

However, the number of completions was down 5% and the NHF believes this is due to a slowdown in development in the sector that started 18 months ago but the desire for more affordable homes will see numbers rise in the coming years.

The region with the highest level of housing association development was London with 13,585 starts and 8,932 completions, followed by the South East and the East of England. The lowest level of development was in the North East where 1,216 homes were started and 1,595 were completed.

The figures also show that more homes were started towards the end of 2016 with 15,000 recorded in the fourth quarter of the year. At the same time the sector was boosted by the announcement in the autumn statement that £6.1 billion in grants will be directed to affordable housing in the UK.

A breakdown of the data shows that 15.9% of starts, some 7,595 homes, were for outright market sale, a 56% rise, while 8.18% or 3,903 were for social rented homes, and the majority, 43.58%, were for affordable rented units, with just over 28% built for shared ownership.

‘These figures highlight the vital contribution housing associations are making to the nation’s housing supply,’ said David Orr, NHF chief executive.

‘Starting nearly 50,000 new homes in 2016/2017 is a great achievement and a clear sign that the sector is recovering from the impact of the rent cut and Brexit vote. It also demonstrates the strength of the housing association business model, with almost half of the new homes built without Government funding,’ he added.

The NHF has been gathering its own data because it believes official Government statistics downplay housing association efforts by excluding some homes they buy through Section 106 planning agreements.

Meanwhile, figures from the Homes and Communities Agency and the Greater London Authority only include homes built through government programmes, meaning there is no official overall figure.

The NHF said the respondents own 93% of the total homes owned by developing associations, meaning the missing landlords were likely quite small. The total figures are therefore likely to be a slight underestimate of the sector’s actual overall output.