Housing completions fall for the first time since 2012 – 13

News

Today (25th November) the Government published its latest data on net additional dwellings. This shows that in the year 2020/21 a total of 216,489 dwellings were completed, almost 11% lower than the corresponding figure of 242,702 net additional dwellings in 2019/20. This is the first time since 2012/13 that there has not been a year on year increase in housing delivery. The number of completions is the lowest since 2015/16.

Net Additional Dwellings chart

The results clearly show for the first time the full impact of the CoVID-19 pandemic within England. Whilst a reduction in the supply is disappointing it isn’t as bad as many predicted in the early days of the pandemic.

The impact of the slow-down in delivery has not been felt evenly over the country with the Yorkshire and the Humber and West Midlands regions suffering the greatest decreases in delivery. In comparison areas such as the East Midlands and South West appear to have been much more resilient to the effects of the pandemic.

Net Additional Dwellings table

This reduction in delivery will have an impact upon how individual local authorities fair against the yet to be published 2021 Housing Delivery Test (HDT) measurement. In September of this year Christopher Pincher, the Housing Minister, identified that the 2020/21 requirement for the HDT would be reduced by 4 months. This equates to 1/3rd of the years supply. Given that the actual decline in delivery is less than 11% it would appear this reduction in the measurement will more than compensate for the effects of the pandemic upon housing delivery.

Pegasus Group will publish a further article upon the impact of latest dwelling completion figures shortly.

Affordable Housing Delivery

Last week ONS also published their annual statistics on affordable housing supply in England which includes data on the delivery of new affordable housing through new build and acquisitions.

Headline figures highlight that affordable housing delivery has also fallen over the last year, with around 52,100 affordable homes being delivered (compared with 58,900 with the previous reporting year 19-20), a year on year decline of 11.5%. This is unsurprising given the clear link with market delivery. This decline is seen across all of the regions, with the exception of the West Midlands which saw a 3.5% increase in new affordable homes being delivered when compared with the previous year. The North East was the worse affected region, which saw a 32.5% drop in new affordable housing delivery, followed by the South West (22.4% fall) and the South East (16.9% fall).

 

Affordable Housing Delivery chart

As with previous years, the data continues to highlight the importance of market housing schemes for the delivery of affordable housing with 47.3% (24,665 homes) being funded through Section 106 (s106) agreements (i.e. nil grant). Although this is a slight fall in the proportion of homes delivered since 2019-20 (51.1%), it highlights a general pattern of s106 agreements delivering funding for around ½ of all affordable housing completions each year.

Net Additional Dwellings completion

For more information on the contents of this note, please contact us.