Rising levels of investment in the north-west of England have seen the region’s construction activity boom in recent years.
While housebuilding levels across the UK have increased by more than 80% across the past 10 years, they are still falling short of the government’s 300,000 per year target. However, each year the numbers have been on the rise, with 161,022 homes registered in 2019. According to the National Housebuilding Council (NHBC), this was the strongest year so far for new home registrations.
But there are some major regional variations in the figures. New research has revealed that housebuilding in the north-west accelerated faster than anywhere else in England over the past five years. Data from Paragon Bank shows that 21,360 new-builds were completed in the year to March 2020. This is a 63% rise from 2015’s equivalent, and a 10.3% compound annual growth rate.
Much-needed properties across the country
The area with the second highest new-build housing growth was the West Midlands. Paragon’s data shows a 57% jump in building from 2015 to 2020. This equates to a compound annual growth rate of 9.5%.
Both of these regions have seen soaring levels of investment and regeneration across their towns and cities in recent years. The government’s Northern Powerhouse and Midlands Engine initiatives have attracted more development and investment to these areas away from London. The jobs markets, economies and transport links of places like Manchester, Liverpool and Birmingham have all seen vast improvements, and have become more investable as a result.
The strong demand has not abated through the coronavirus pandemic, according to research. Zoopla figures show the north-west was one of the fastest areas to recover in terms of housing demand and prices. It is also forecast to have the strongest housing market over the next five years, according to Savills.
“Build, build, build”
‘Levelling up’ the country is a key focus for the government in terms of housebuilding, particularly in light of the pandemic. Back in July, Prime Minister Boris Johnson set out his plans for a ‘new deal‘, which would see a planning system reform as well as more investment in infrastructure in the north and Midlands.
Commenting on Paragon’s latest figures, Robert Orr, managing director, believes it is important that housebuilding levels continue to grow.
“Small to medium-sized property developers are an important component of housing provision and we are seeing strong demand from our customers as they look to build the homes of tomorrow,” he says.
“The government’s planning reform proposals should encourage more new homes across the UK, which will be much needed as the coronavirus pandemic will have slowed new housing starts during 2020.”
The area of England with the lowest levels of housebuilding growth was the south-west. Over the past five years, this region has only seen a 19% rise. Similarly, housebuilding in the north-east of England has only risen by 20% between 2015 and 2020. This area also has the lowest actual number of new-builds, with just 8,160 registered in the year to March 2020.