Worst slump in housebuilding in London since Nineties crash
HOUSE builders have slashed their plans for constructing new homes in London amid fears about the impact of Brexit on the property market, alarming new figures reveal today.
Developers registered to build just 2,494 homes in the capital between July and September, down 35 per cent on the same period last year, according to data from the National House Building Council.
It was the steepest quarterly fall since the depths of the early Nineties property crash.
That left London close to the bottom of the regional league table of housebuilding in England — ahead of only the North East and Yorkshire and Humberside — despite having by far the most acute housing shortage in the country.
The NHBC’s figures measure registrations for a warranty for a newly built home, which is normally done a few weeks before construction starts. They are regarded as one of the most reliable indicators of levels of housebuilding activity. The third quarter slump leaves new home registrations in London for the year at just 12,669, down nine per cent on last year.
Steve Wood, chief executive of the NHBC, said quarterly figures could be skewed by the timing of big developments but warned that Brexit jitters and a cooling at the top end of the market were all making life difficult for developers.
He said: “There is a lot of uncertainty, socially, economically and politically at the moment.”
He said there had also been a slowdown in the housing association sector as attention turned to ensuring that existing housing is safe in the aftermath of the Grenfell Tower disaster rather than building new homes. He added that levels of completions were holding up with 15,702 so far this year in London, up one per cent.
However, that is still far short of the widely accepted need for about 50,000 new homes a year to tackle the housing crisis.
Polly Neate, chief executive of the housing charity Shelter, said: “It’s a serious worry to see such a dramatic fall in the capital where we need more homes, including affordable.
“Sadly this is no surprise when our house building system allows developers to decide what homes to build where rather than focusing on the homes people really need in the areas where they need them most.”
A spokesperson for the Mayor of London said: “Since day one the Mayor has made it clear he will do everything in his power to increase the delivery of affordable homes in London — recent figures from London First show affordable housing across all planning applications in London rose to 38 per cent in the first half of this year, up from the paltry 13 per cent towards the end of the previous Mayor’s term in office.”
Communities Secretary Sajid Javid has said the government should borrow money for hundreds of thousands of new homes to solve the growing housing crisis. He told The Andrew Marr Show: “We are looking at new investments and there will be announcements.”