Mixed News on Housing Construction
Housing Minister Gavin Barwell has recently suggested in an interview that, at the current rate of construction, the target of building one million new homes by 2020, will not be reached. He stated;
“We inherited a position in 2010 where house building rates in the country were at their lowest since the 1920’s… We’ve seen significant progress. But absolutely we are still not at the rate that we need to be in order to meet our ambition to get this country building the homes that are so desperately needed”.
In line with this position, Communities Secretary Sajid Javid has issued a stark warning to housebuilders and stated that unless the sector speeds up the rate at which they deliver new housing, government intervention may be a necessary evil;
“People can’t live in a planning permission – what we need is to find ways to incentivise developers to use planning permissions”.
These criticisms from both Barwell and Javid have been challenged by the HBF, with the body stating that potential fines will simply act as a further mechanism to slow the process down. They go on to offer evidence that the sector has recently seen a significant increase in output.
This argument was further backed up by the findings from the latest Markit/CIPS UK PMI, with initial indications suggesting that strong growth and sales have been seen by the larger housebuilders post-Brexit. Housebuilding remains a key driver in this growth trajectory, but with the report suggesting uncertainty in the coming months and years, the outlook remains unknown.