New home starts slump 27% amid labour and materials crisis

Aaron Morby 2 years ago

Concrete evidence is emerging that widespread materials and labour shortages are stifling new housing starts.

Fresh figures from the National House Building Council show that new homes registrations slumped 27% in the third quarter to 33,780 albeit from a 14-year record high of 46,440 in the second quarter.

The fall was also partly attributed to housing associations prioritising remedial works like fire safety measures ahead of building affordable rented homes.

New home registration returns also reveal a shift away from apartments living back to houses, suggesting a post Covid focus on houses ahead of apartments.

Third quarter split by home type

Across the regions, the East Midlands surged into life with registration doubling to 4,810 starts in year-on-year comparisons, making it the busiest region just ahead of the fast recovering East of England up nearly a third.

The regional recovery contrasted with London, which records a 78% plunge in registration year on year in the third quarter to September.

New home registrations – UK regions
Region Q3 2020 Q3 2021 %change
North East 986 1,834 86%
North West 3,619 4,430 22%
Yorks & Humbs 1,542 2,517 63%
West Midlands 2,287 3,229 41%
East Midlands 2,370 4,810 103%
Eastern 3,228 4,184 30%
South West 2,969 2,949 -1%
London 5,113 1,139 -78%
South East 4,070 4,319 6%
Scotland 1,746 2,627 50%
Wales 838 888 6%
NI & IOM 798 853 7%
Total 29,566 33,779 14%

NHBC Chief Executive Steve Wood said: “There is confidence in new homes despite the significant supply-chain disruption presently being experienced.

“House builders are responding swiftly to shifts in consumer demand for detached houses that offer more space. The move away from apartment blocks is affecting London but this is only one quarter’s data.”


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