There was an 11% increase in the housing supply in England in 2015/2016 and new delivery was up 5.7%, according to official figures but the industry warns that more are needed.
The statistics from the Department of Communities and Local Government (DCLG) show that housing supply increased to 189,650 but this was still below the target of 200,000 homes needed to cope with demand.
The figures show that 163,940 new homes were built, there were 30,600 gains from change of use between non-domestic and residential, some 4,760 from conversions between houses and flats and 780 other gains such as caravans, house boats etc. but this was offset by 10,420 demolitions.
The industry reacted by saying that while it is good news that new build home delivery was up 5.7% to almost 164,000, even more homes are needed at a time when demand is outstripping supply and new homes are not necessarily being built where they are needed.
A breakdown of the figures show that the number of net additional dwellings reached a recent peak of 223,530 in 2007/2008 and then decreased to 124,720 in 2012/2013 with the economic downturn. Since then, net additions have increased to 189,650 in 2015/2016, up 11% on the previous year but this level is 15% below the 2007/2008 peak
The highest high rates of net additional dwellings were in parts of Devon, Somerset and Gloucestershire, continuing outside the Green Belt of London and on into Buckinghamshire, Bedfordshire, Oxfordshire, Northamptonshire, Cambridgeshire and Norfolk.
Cherwell, Dartford and Tower Hamlets have the top three net addition rates per 1,000 dwellings in the country and other notable areas with high rates of net additions per 1,000 dwellings were in the Vale of White Horse, Horsham, North West Leicestershire and Ashford.
In London it is a mixed picture with five of the top 40 net addition rates per 1,000 dwellings, but also four of the bottom 40. Areas with low levels of net additions are geographically varied. Sefton, Bexley and Cannock Chase had the lowest three net additions and the report says this was due to a high level of demolitions and a medium level of new build.
Changes in the level of net additional dwellings between 2014/2015 and 2015/2016 also varied across England, increasing in 195 out of 326 authorities. The geographic spread of increases and decreases is mixed. In London some 21 out of 33 London Boroughs showed some level of increase and 12 has decreases.
But more homes are needed, especially in London where affordability is an issue, according to Susan Emmett, director of Savills residential research. She explained that while the new housing supply is now closer to the 200,000 a year needed to meet the Government’s target of delivering a million homes by 2020 the spread of new homes is patchy.
‘New build homes make up 86% of that total. However, change of use from commercial to residential, including permitted development rights where full planning permission is not required, delivers a substantial contribution of 30,600 to the housing numbers after a 50% increase on the previous year,’ she said.
‘However, Cherwell, Dartford and Tower Hamlets in east London, have the highest levels of additional homes. Beyond that, some of the biggest numbers emerged outside the M25 and London’s Green Belt in Buckinghamshire, Bedfordshire, Oxfordshire, Northamptonshire, Cambridgeshire and Norfolk. These are high demand areas where we expect to see the highest growth in house prices over the next five years,’ she explained.
‘We still need more homes particularly in London. Our estimates suggest that we really need 300,000 new homes a year to cover a backlog of need after years of undersupply. The challenge now is sustaining this level of delivery without being side tracked by Brexit or the American election results,’ she added.
‘Building more homes not just for ownership but for a range of tenures, and delivered by a greater variety of housebuilder would help,’ she concluded.
Ian Thomas, director of online mortgage lender LendInvest, pointed out that the Royal Institution of Chartered Surveyors has described the shortage of supply as ‘dire’ and added that it sends a clear message that government must use the Autumn Statement and its forthcoming Housing White Paper to introduce measures to put more homes on British streets.
‘We promised to turbocharge house building so more people can have the security of their own home, and that is exactly what we are doing with the biggest increase in the number of new homes in many years,’ said Housing Minister Gavin Barwell.
‘We know there is more to do to ensure the housing market works for everyone and not just the privileged few and we will be setting our further details in our housing white paper shortly,’ he added.
According to Stewart Baseley, executive chairman of the Home Builders Federation, the figures provide the best evidence to date as to how much house builders have ramped up housing supply and he believes that the Government’s ambitious target to build one million homes over the course of this parliament is now within reach.
‘In response to the positive measures introduced by Government in recent years, such as Help to Buy, huge increases in output have been delivered. Providing Government continues to create an environment within which the industry can operate and grow house builders will continue to increase delivery of new homes,’ he said.
‘The industry is committed to delivering the high quality new homes the country needs to address our housing crisis. As we build desperately needed new homes the industry is creating hundreds of thousands of new jobs directly and in the supply chain boosting local economies across the country. Moving forward, the house building industry will play a key role in building a new Britain and driving our post-Brexit economy,’ he added.
