Work was started on £55bn worth of new-build homes in England during the 2022-23 financial year.
This is according to new research from Sourced Franchise, the property investment platform.
In 2022-23, there were 137,800 starts in England. This marks a -1.4% decline from the previous year however this remains the second highest number of starts since 2018.
Sourced Franchise studied new-build start data from the past five years to see how this current period of economic turmoil is affecting the construction rate and sale price of new-build homes in England.
There are varying definitions, but a new-build house or flat is most often counted as a ‘start’ from the moment on-site construction begins. For example, when the foundations are laid for a block of 100 flats, that is counted as 100 ‘starts’.
Regionally, the annual change in the number of new build starts ranges from a 13.4% increase in London to a -14% drop in Yorkshire & Humber.
Meanwhile, 2022-23 saw a 13.8% annual increase in the average new-build house price, climbing to £399,063.
The South West (16%) recorded the largest annual price growth, followed by the East Midlands (15.9%) and West Midlands (14.8%). England’s lowest growth was recorded in London (9.3%).
The capital, however, remains the most expensive new-build region with an average price of £559,569. This is followed by the South East (£483,944) and the East of England (£469,848).
The total estimated value of new-build starts in 2022-23 sits at £55bn in England.
Around £11bn of this value is located in the South East, followed by London (£8.9bn) and the East of England (£8.8bn).
Sourced Franchise director, Chris Kirkwood, comments: “It’s great to see that the new-build sector has remained largely undeterred by the current economic landscape and the sector is continuing to push forward to deliver a much-needed boost to housing stock levels”.
He adds: “While total starts may have declined marginally year on year, a notable £55bn worth of property is making its way to market, although it’s fair to say that there is quite a disparity in delivery from one region to the next”.
The relatively upbeat analysis from Sourced Franchise on new build may offer a degree of encouragement however as Mortgage Strategy has reported in recent weeks, many in the housebuilding and development sectors have warned of slowing levels of business as inflation and interest rate pressures mount.
Last week new-build construction output fell to its lowest level since June 2022 and the UK’s biggest housebuilder Barratt Developments predicted a 25% drop in completions for 2024.
This was followed by news that the Department for Levelling Up will hand back £1.9bn to the Treasury originally meant to tackle England’s housing shortages.
The government has also come under fire for abandoning its own housing policy to build 300,000 new homes each year. This year only 120,000 new homes are expected to be built.
