Official statistics released by the Ministry of Housing, Communities and Local Government show that housing supply in England has by fallen 6% year-on-year.
The new data for the 2023/24 period shows that there were 221,070 net additional dwellings, down from 234,290 in the previous year.
This marks the lowest amount since 2015/16, not including the Covid-impacted 2020/21 period.
The MHCLG report says that net additional dwellings include new build homes, conversions and buildings that have had their use changed. Demolitions are then reduced from the total.
The number of new build homes decreased by 7%, dropping to 198,610 from 212,360 the previous year. This figure shows the significant level of growth needed to achieve the Labour government’s target of 1.5million homes over its five-year premiership.
Throughout the year, all regions in England saw a drop in net additions bar one – Yorkshire and the Humber. The North East, South East and East Midlands saw the sharpest falls in annual delivery, while London’s output fell by 9% to 32,162, the lowest in nine years.
Knight Frank’s associate in residential development research, Anna Ward said: “England’s annual housing supply has dropped 6% to an eight-year low of 221,071 net additional dwellings in the year to end March 2024, with nearly all regions seeing declines. London’s output fell 9% to a nine-year low of 32,162 homes, and the capital alongside the South East faces the largest shortfalls relative to Labour’s proposed 370,000 annual target. Meanwhile, housing completions across England up to mid-November, using EPC data as a proxy, are down 7% from 2023 and 14% from 2022.”
“These declines reflect the mounting challenges to boosting delivery, including construction capacity constraints and economic pressures stemming from market volatility. Addressing this shortfall requires empowering entrepreneurial developers in urban centres as well as traditional greenfield builders.”
Charlie Hart, head of development land at Knight Frank said: “The decline in London and the South East highlights the pressing need for bold policy reform. While the UK housing market presents significant opportunities, particularly in our cities, we need to create conditions that attract global investment and support entrepreneurial developers.”
“SME developers, who are vital to urban regeneration, have demonstrated their willingness to drive innovative solutions when operating within a supportive framework. Creating a more competitive investment environment would help unlock the potential of our cities and boost housing delivery to meet growing demand. Looking ahead, policy changes that incentivise development and welcome global capital could transform our urban landscapes and help address housing shortages.”
