Delivery of new-builds hits highest figure in over 20 years, despite COVID

The delivery of new-builds is picking up pace as the housebuilding sector has remained resilient and is rebounding from the COVID-19 pandemic.

Data from the Ministry of Housing, Communities and Local Government shows new-build developments got off to a strong start this year. The housebuilding sector has continued its recovery from the disruption caused by COVID-19.

In the first three months of 2021, 49,470 new-build homes were built in England. This is the highest figure in over 20 years and a 4% rise from the last three months in 2020. During the first quarter of this year, builders also started on 46,010 new-build properties. This is the highest number in nearly 15 years and a 7% increase on the previous quarter.

Resilience of building sector

These figures further illustrate the resilience the housebuilding and construction industry are seeing. The industry was hit in the early stages of the pandemic. Construction sites closed during some of the first national lockdown.

Later, the government introduced measures to keep building sites open. New health and safety measures helped keep workers safe. And builders could negotiate with their local council for flexible working hours on construction sites.

These measures led to a growing number of new-build developments. This comes after a low point during the second quarter of 2020. And now housebuilding is playing an important part in England’s economic recovery from the pandemic.

Housing Secretary Robert Jenrick says: “The house building sector has shown extraordinary resilience and the government has continued to demonstrate its support for the industry throughout the pandemic.

“By enabling construction sites to remain open and operate safely, builders have been able deliver the homes this country needs as we build back better from the pandemic.”

Additionally, the recent IHS Markit / CIPS UK Construction PMI revealed construction output growth hit a 24-year high in the month of June. The sector’s recovery was led by housebuilding, where construction work increased at the fastest rate since November 2003.

Bringing forward more housing

Additional new housing still needs to be brought forward. Previous estimates revealed the UK needs between 240,000 and 340,000 new homes a year to keep up with increasing demand.

In the year to the end of March, only 155,960 new-builds completed. This is 11% fewer than in the prior 12 months. Before COVID-19, the number of new-builds had been steadily increasing each year since 2014. This shows the pandemic disruption is still having an impact on figures.

However, new-builds aren’t the only way properties are added to the UK’s housing stock. New homes are also created through the conversion of existing buildings, such as offices or factories, into residential properties and large houses divided into flats.

Applications for Energy Performance Certificates on new dwellings totalled 220,730 in the year to the end of March. This indicates the overall rise in homes in England was substantially higher than just the new-build figures.

New-builds and newly converted properties are rising in demand. These kinds of properties typically come with higher energy efficiency ratings, which are becoming a bigger priority for many homebuyers, property investors and tenants.

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