Number of housing completions up

The number of new homes that have been built in England rose for the first time since 2007 during the second quarter of the year, figures have shown.

Housing completions edged ahead by 1% to 26,550 during the three months to the end of June, the first quarterly increase since the end of 2007, according to Communities and Local Government.

There was also a 13% jump in the number of new homes that were started during the same period, with these reaching a two-year high of 28,590.

Within this total, there was a 10% increase in the number of properties being built by private developers and a 17% rise in ones started by registered social landlords.

CLG said the number of new housing starts during the three months was 84% higher than when the market hit its low point during the first quarter of 2009. But it added that despite the improvement, new build levels were still 42% below their peak in the first three months of 2007.

Housebuilders were hit hard by the combination of the credit crunch and the housing market correction, which led to them mothballing sites and putting future developments on hold. The number of new homes built during 2009 fell to its lowest level since the Second World War. But the sector has been showing signs of recovering, as the housing market has improved.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, said that while today's figures looked encouraging, there was good reason to question whether the trend could be sustained for the rest of the year and into 2011.

He said: "The recently-published RICS Construction Market Survey shows new inquiries to begin housing projects actually turned negative in the second quarter of this year. Meanwhile, the Home Builders Federation has highlighted a drop in site visits and an increased use of incentives in its latest report. Critically, we suspect that housing starts this year will amount to around 110,000 and the number for next year will be little higher."

A total of 98,500 new homes were started during the 12 months to the end of June, 44% more than during the previous 12-month period. But housing completions during the past year were 13% lower than 12 months previously at 110,210.

All regions of England saw an increase in the number of new homes being started during the year to the end of June, with the South East seeing the biggest rise at 17%, while the North East saw the smallest one at 5%. But seven out of the nine regions saw a fall in the number of properties that were completed during the same period, while in London the figure remained static.

source: UKPA