There was much trumpeting about the
latest housebuilding figures released by the DCLG this week. But the latest figures indicate that completions are still 18% below the peak in March 2007.
Sure, the number of completions in the year to 31 March 2017 is up 6% on figure for the 12 months to 31 December 2016, which was down 1% on the previous 12 months. However, the government’s own target of a million new homes by 2020,
announced 21st September 2015 by the then housing minister Brandon Lewis, will not be achieved.
Since Brandon Lewis made the now infamous announcement, just 353,590 new homes have been completed - an average of just 35,359 each quarter according to the government’s own figures, which also include micro homes in converted office blocks.
With just 11 quarters remaining until 1st January 2020, this would indicate around 742,539 new homes will be built by 2020, giving a shortfall of 257,461 new homes (25.7%).
Even using the much reported
"highest number of completions" figures for the latest quarter, around 788,310 new homes will be built since Brandon Lewis made the pledge.
To achieve a
"million new homes by 2020" a further 646,410 new homes would need to be built in the next 11 quarters, 58,765 in each and every quarter, a 48.6% increase on the latest quarterly completion figures, around 235,060 new homes each year.
But it is blatantly obvious to anyone, that this target could never be achieved without a massive state-funded council house building programme, the like of which has not been seen since.1994.
A plc housebuilders primary function is to make money as one said -
"we're not here to build perfect houses, we're here to deliver value to our shareholders". Land banking and drip feeding supply onto the market keeps prices high. As Matthew Pointon, property economist at Capital Economics told the BBC in 2015,
"By building them more slowly it means they can maximise the value of their assets"
If the government announced that Help to Buy was being withdrawn at the end of this year, I suspect housebuilders would increase completions in 2017 way above the peak of March 2007 to take full advantage!
