The government is considering emergency measures to stimulate house-building after a leaked internal report predicted new home starts could fall next year
The official documents compiled for the Department for Communities and Local Government (DCLG) and seen by the BBC, report that housebuilding is set to drop by 4 per cent in the run up to the general election in 2015.
According to the broadcaster, the as-yet-unpublished report predicts that the house-building figures for February 2015 will show ‘a decrease in the number of houses started this year : down from 133,650 in 2013/2014 to circa 128,000 in 20145/15 (-4 per cent).’
The report, which was marked ‘sensitive’, also revealed that 9,000 sites for approximately 350,000 homes with full planning permission haven’t started building.
The warnings contrast with findings released yesterday by industry analyst Glenigan which showed that construction output continued to be fuelled by housing with the value of construction starts in the residential sector over the last three months rising by 10 per cent.
The leaked document’s figures have been disputed by NHBC chief executive Mike Quinton, who said: ‘NHBC’s 2014 registration figures have shown a sustained growth and consolidation in the UK house-building industry following a strong year last year, and we hope that this will continue.
‘However, we have always been clear that this growth is from a historically low base as the UK still has a chronic shortage of new homes. Government measures to support house building, such as Help to Buy, have already helped the industry, but further support may be needed if growth is to be sustained in the long term.’
Steve Turner, Head of Communications for the Home Builders Federation said: ‘Since the launch of the Help to Buy equity loan scheme we have seen a significant increase in house building activity. All indicators are showing increases in the region of 25 per cent.
‘To facilitate this, the industry has recruited thousands more people and worked hard with its supply chain to ensure the skills and materials are in place. However, If increases in supply are to be sustained the industry also needs land on which to build the homes the country needs.
‘Existing sites are being built out more quickly and so builders need to get onto new sites sooner. Thousands of potential plots for new homes are stuck awaiting final planning permission and if we are to see sustained increases, the planning system also needs to be sped up to match the new level of demand.’
A recent report the GMB Union claimed that the UK needed to double the number of homes built per year to have any chance of reining in the looming housing crisis.
The DCLG document also reportedly criticises local councils not adhering to the right to buy one-to-one policy, where councils are expected to build a replacement home for every one sold.
The report states: ‘[Twenty] councils each retained £5m+ in receipts but started fewer than 30 replacement homes. £50m of receipts held by these councils for over 12 months. No incentive to start early.’