UK housebuilding remains resilient with strong delivery of new-builds

New data shows UK housebuilding is recovering from the COVID-19 pandemic as the delivery of new-build homes is on the rise.

In recent months, there has been a sustained period of growth in UK housebuilding. The delivery of new-build homes has continued to increase since the first initial lifting of the COVID-19 restrictions last year. In the last quarter of 2020, there was estimated to be 42,110 new housing starts, according to figures from the Ministry of Housing, Communities & Local Government (MHCLG). This is a 16% rise on the previous quarter.

Additionally, there were 46,950 completed new homes in October to December last year, which is a 4% rise compared to the quarter before. This is even the highest completions figure since the March quarter of 2007. These figures show the resilience of the housebuilding and construction industry even throughout the COVID-19 pandemic.

Housing Secretary Robert Jenrick comments: “Today’s figures show a steady increase in the number of new housing starts and the number of new homes built, highlighting a sustained period of growth in the housing sector as it continues its recovery.”

Figures for London show there have been a rise in housebuilding starts in the capital, despite the pandemic. The number of starts increased by 11% from 2019 to 2020 to 13,460. Additionally, the data shows in 2019 to 2020 houses made up 79% of all new build dwellings. This is even the highest proportion since 2000 to 2001.

Support from the government

This new data from MHCLG shows the housebuilding and construction industry’s resilience. The sector successfully adapted to measures to keep construction sites open safely. Building sites closed for a temporary period at the beginning of the first national lockdown last year. However, sites have been able to remain open during the second and third lockdowns.

With housebuilding already returning to pre-pandemic levels, this is especially positive as the sector is expected to be a significant part of the UK’s economic recovery. Prime Minister Boris Johnson’s plans to “build, build, build” after COVID-19 will help “level up” the country. The government has made housebuilding a priority and provided support to the construction sector.

Robert Jenrick says: “The government has continued to demonstrate its support for the industry throughout the pandemic by enabling construction sites to remain open and operate safely in line with important public health guidance. We’ve intervened to help the sector bounce back despite all the challenges we’ve faced.”

Additionally, new measures were announced in the Spring Budget that will provide a direct boost to housebuilding. There are tax incentives on company investments in new plant and machinery assets. This will allow companies to cut their tax bill by 25p for every £1 of investment. The government is also providing funding to invest in modern methods of construction. The intent is to accelerate the delivery of homes built using these methods.

Looking ahead

There’s growing confidence in the housebuilding and construction sectors. This is due to the success of the vaccination program and as lockdown restrictions ease.

In recent months, the property market has remained remarkably busy. The stamp duty holiday and mortgage guarantee scheme are also improving confidence among builders. There is such a strong appetite for homes and new-builds, further providing a boost to the sector.

The construction industry adapted quickly to the challenges the past year brought. This success has improved planning and productivity in the industry. These improvements could even bring forward more quality new-builds in a shorter amount of time and help the government reach its goal of delivering 300,000 homes a year by the mid 2020s.

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