Housing starts fell 16% in pandemic year

The number of housebuilding starts is believed to have dropped by more than 15% last year in the wake of the coronavirus crisis, according to the first official figures.

The housing ministry data, published today, showed that an estimated 127,580 homes were begun, according to building control records. This represents a 16% drop on 2019, and a fall of nearly a quarter on the high point reached in 2018.

The news comes despite a swift recovery by the industry from the halving of starts seen in the second quarter of last year as the first lockdown hit, and compares favourably with initial forecasts that starts could drop by 60%.

The data showed a similar hit to housebuilding completions, with completions for the year down 17% to 148,620, from the recent high point of 178,300 seen in 2019.

The data released today also showed that the last quarter of the year maintained the strong recovery from the pandemic hit seen already in the third quarter. It said that that seasonally adjusted starts were up by 16% in the last quarter on the third quarter, to a level 24% above the same figure in 2019.

Similarly, completions rose, seasonally adjusted, by 4% on the previous quarter, to 6% above the figure seen in the last three months of 2019.

The government describes this official data, derived from building control record, as “indicators of new supply”, because the numbers do not cover the whole of the housebuilding market, however it says they are still useful and indicating how housebuilding activity is changing.

The most accurate assessment of exactly how many homes are produced each year is contained in the government’s “net additions” data, which, however, has a much greater time lag before being produced.

The government said in November that there were 243,770 net additional new homes produced in the year to March 2020, a 30-year record. However, numbers covering the pandemic period will not be released until this autumn.