The value of UK housing starts has registered its first drop in 18 months because of a decline in social-housing new build, according to a leading industry tracker.
Analysts Glenigan’s October Index of Project Starts recorded a 6 per cent fall in new-home starts involving 10 or more dwellings, comparing the past three months with the same quarter last year.
The figure reflects a 1 per cent rise in private-sector starts over that period, massively offset by a 17 per cent decline in social housing starts.
Glenigan economics director Allan Wilén said the combined effect was that the firm’s residential index was in minus figures for the first time since April 2013.
‘Signs of a stabilisation in new project starts underlines the challenge the government faces in meeting housing need,’ he said.
‘With social housing seeing a 17 per cent fall in the value of starts in the latest quarter, an increasing share of the UK’s housing supply is dependent on the private sector.’
The figures follow the release of the latest Nationwide House Price Index earlier this week, which reported a 0.2 drop in UK house prices in September, fuelling fears of a property market slowdown.
However, according to EC Harris the number of luxury homes currently being planned or under construction in London hit a record high this year - a huge £60billion of new top-end properties were expected to be delivered over the next decade. This was a twenty percent increase on 2013.
Meanwhile Glenigan said non-residential activity remained positive, with the retail sector seeing a 54 per cent rise in starts driven by developments such as the £80 million Banbury Gateway retail park in Oxfordshire.
It reported office-sector starts rising at 12 per cent, hotel and leisure starts up 10 per cent, and industrial starts up 8 per cent.