The number of new homes being built in England hit a 21-year high in the first quarter of this year. And 81% of them are houses.

The new homes industry got off to a flying start this year as it continued to recover from Covid-19 disruption.

A total of 49,470 properties were completed between January and March, the highest level since figures were first collected in their current format in 2000.

Meanwhile, the number of houses in development accounted for 81% of all new builds, the highest proportion since 2000/01.

There was also a steep jump in the number of new-build starts, with the first phase of construction hitting a near-15 year high, according to the Ministry of Housing, Communities and Local Government.

Why is this happening?

The housebuilding industry was hit hard in the early stages of the pandemic, when construction sites were forced to close during lockdowns.

But the Government has since introduced a range of measures to enable building to continue, while also keeping workers safe, including allowing builders to negotiate flexible working hours on construction sites with their local council.

The measures have led to a steady increase in the number of new homes being completed, since a low point in the second quarter of last year.

Who does it affect?

The Covid-19 pandemic has seen people undertake a once-in-a-lifetime reassessment of their housing needs, as they search for more space following successive lockdowns.

The good news for potential buyers who want to purchase a new-build property is that 81% of homes completed during the first quarter were houses, rather than flats, the highest level since 2000/01.

In regional terms, the proportion of new homes being completed was highest in the South East, East Midlands and East of England, while new-build starts were highest in the South West and East of England.

The jump in new properties being built particularly benefits first-time buyers, who can use the Help to Buy scheme to purchase a new-build home with just a 5% deposit.

What’s the background?

It has previously been estimated that the UK needs between 240,000 and 340,000 new homes a year to keep pace with rising demand.

Only 155,960 new homes were completed in the year to the end of March, 11% fewer than in the previous 12 months, as Covid-19-related disruption continued to impact figures.

Before the pandemic struck, the number of new homes being built had been on a steady upward trend since 2014.

But building new homes is only one way in which properties are added to the available housing stock.

Residential properties are also created through the conversion of existing buildings, such as factories, offices and farm buildings into homes, or dividing large houses into flats.

In the year to the end of March, applications for Energy Performance Certificates on new dwellings totalled 220,730, suggesting the overall increase in homes in England was significantly higher than just the new-build figures suggest.

Top three takeaways

  • The number of new homes being built in England hit a 21-year high during the first quarter as the industry continued to recover from Covid-19 disruption
  • A total of 49,470 properties were completed during the three months to the end of March, the highest level since the figures began being collected in their current form in 2000
  • Houses accounted for 81% of all new properties built, the highest proportion since 2000/01