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Economic slowdown threatens PM's housing target

Prime Minister Gordon Brown’s goal of building two million new homes by 2016 is under threat as UK housebuilders brace themselves for a predicted slump in the housing market.

One of the Prime Minister’s key pledges is to ramp up the number of new houses built in the UK to 240,000 a year from the 2006 level of around 160,000 a year.

But now many industry insiders believe that the PM’s target is too ambitious given the slowdown in the UK economy.

John Stewart, director of economic affairs at the Home Builders Federation, told the Daily Telegraph: ‘Logically the number of completions in 2008 will reflect the decline in starts in 2007’.

The gloomy predictions are against a backdrop of poor financial forecasts from some of the UK’s top housebuilders.

Redrow, Persimmon and Miller have all recently issued negative forecasts, and last Friday (11 January) Bovis Homes announced its reservations at 31 December 2007 were 19 per cent down on the previous year.

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