Net new housing additions highest in 10 years but rate of growth slows, figures show

More than 222,000 homes were added to England's housing stock in 2017/18, the highest figure since before the 2008 financial crash, but the overall rate of growth has dropped sharply compared to recent years.

The MHCLG offices in central London
The MHCLG offices in central London

The figures, published today by the Ministry for Housing, Communities and Local Government (MHCLG), show that annual housing supply in England amounted to 222,190 net additional dwellings in 2017/18 - up two per cent on 2016/17 (217,350).

This is a sharp fall on the 15 per cent rise in 2016/17, 11 per cent rise in 2015/16, 25 per cent rise in 2014/15, and ten per cent rise in 2013/14.

According to the figures, the 222,190 net additions resulted from 195,290 new build homes, 29,720 gains from change of use between non-domestic and residential, 4,550 from conversions between houses and flats and 680 other gains, offset by 8,050 demolitions.

The 195,290 new build net additions figure was up by 11,720 on 2016/17’s 183,570 new additions, 2015/16’s 163,940, and 2014/15’s 155,080.

The contribution from homes created under residential permitted development rights fell by 5,361 units to 13,526. This was down from 18,887 in 2016/17 and 13,879 in 2015/16.

These include conversions under agricultural to residential, office to residential, storage to residential, and light industrial to residential permitted development rights.

The figures are the highest since 2007/08, just before the financial crisis, when 223,534 homes were created. 

According to the MHCLG, the 2017/18 figure "represents the highest level of new homes delivered across England in all but one of the last 31 years and brings the total number of additional homes delivered since 2010 to 1.3 million".

Housing secretary James Brokenshire said: "Today’s figures are great news and show another yearly increase in the number of new homes delivered, but we are determined to do more to keep us on track to deliver the homes communities need.

"That’s why we have set out an ambitious package of measures to deliver 300,000 homes a year by the mid-2020s. This includes over £44 billion investment, rewriting the planning rules and scrapping the borrowing cap so councils can deliver a new generation of council housing."

Jason Lowes, partner at consultancy Rapleys, said: "The number of new build completions has continued to increase, further reinforcing the welcome findings of the Letwin Review that there is lack of evidence for the often repeated claims that developers are guilty of land-banking. Today’s statistics strongly suggest that developers are not holding back from delivering housing once planning consents have been given.

He added: "The sharp decline in permitted development rights developments are perhaps the most striking figure in today’s statistics, and demonstrate why the government was keen to extend the system to include retail properties.

"Permitted development rights applications have broadly been on a downward trend since the system was introduced and this is likely due to a simple reduction in overall stock availability. As the floodgates opened, a large number of initial applications was always likely, as was the subsequent drop off as the most viable sites began to be converted. There do remain a large number of permitted development rights applications going through the system though, and it’s clear that permitted development remains an important tool for developers looking to bring forward the housing that the country needs."

The Conservative Party’s 2017 general election manifesto pledged to meet the commitment to delivery a million homes by the end of 2020 - a rate of 200,000 a year - and deliver "half a million more by the end of 2020".

The net additional dwellings figures are a key component in the government's calculation of the new housing delivery test, the first results of which are due to be announced this month. 

Earlier this month, the Town and Country Planning Association (TCPA) warned that new proposals to extend permitted development rights that were announced in the Budget could "condemn desperate people to live in badly designed boxes". 

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