Official house-building figures are out – and there’s a surprise

Building SiteThe Government’s latest official house-building numbers were released on Thursday, and there’s some good news.

Surprisingly, 217,000 homes were added in the year to March 2017. That’s not only the biggest increase since 2008, but takes us to the sorts of levels politicians have been calling for. That 217,000 is the net change (homes built minus homes lost).

It’s the first time since 2008 that we’ve had a net increase over 200,000. It suggests that house-building may be finally recovering, a full decade after the crash.


The increase has been nearly in all the private rented sector (PRS). Owner-occupied numbers remain down on 2008, despite showing growth over the last few years. Renting from councils and social landlords has crept up in the last decade, but only slightly. Private rental has soared.

In 2001, 2.1 million homes were privately rented. By 2010 that had nearly doubled to 3.9 million, and by 2017 it was just below 4.8 million.

From 2016 to 2017 there was a slight drop in PRS and a similar nudge up in owner-occupied. Whether that’s the start of a trend, a blip in the figures or even a statistical error remains to be seen. These figures aren’t perfect and the 2021 census may result in significant corrections.

North West

Across Greater Manchester, Salford was by far the biggest home-builder in 2016-17 with nearly 2,500 new properties. Manchester City was well behind in second place with just under 1,800. Rochdale, Oldham and Trafford (315, 326 and 330 respectively) brought up the rear.

On Merseyside, Liverpool was way in front with 3,485 new homes. Wirral took the wooden spoon with 328.

Lancashire managed 4,530, Cumbria 1,511 (with just 65 new homes in Barrow-in-Furness). Cheshire East scored 1,763 and Cheshire West and Chester a respectable 2,020.

Market failure?

Given the number of people who want to buy a home and can’t afford to, the lack of homes to buy is surely a market failure. There are fewer owner-occupied homes in England than there were in 2005, despite the population having increased by about four million. That failure of supply to meet demand has pushed up the average house price from £160,000 to £232,000 (a 45% hike) putting home-ownership ever more out of reach for far too many people.

The Government often suggests that the growth of neighbourhood plans is helping to push through more planning permissions. In our experience this is not the case, and more often than not, neighbourhood plans act as a brake on development progressing.

Political efforts to fix this problem too often end up increasing demand even further, but the evidence suggests what’s needed is an increase in supply. The Government will be hoping the small movement in the right direction is a sign of the wind changing.

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