Wet weather and economic challenges ‘dampened house building in early 2024’
Some 21,967 new homes were registered to be built in the first quarter of 2024, down by 20% compared with the first quarter of 2023, new figures show.
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Your support makes all the difference.The number of new homes being registered fell by a fifth annually in the first quarter of 2024, amid poor weather conditions, skills shortages and economic challenges, according to an industry body.
Some 21,967 new homes were registered to be built in the first quarter of 2024, down by 20% compared with the first quarter of 2023, the National House Building Council (NHBC) said.
The figure was an increase compared with the fourth quarter of 2023, when 19,084 new home registrations were recorded.
The NHBC has a 70%-80% share of the UK warranty market.
Its figures indicate the stock of new properties in the pipeline as homes are registered with the NHBC before being built.
Build volumes are anticipated to rise in the second half of the year as economic conditions begin to improve and consumer confidence starts to recover
It said that 26,240 new homes were completed in the first quarter of 2024, marking a 13% fall compared with the first quarter of 2023.
The NHBC said that despite the fall in new homes being registered to be built, there were some tentative signs of growth.
Some 8,320 new homes were registered to be built in March – which was a higher figure than the totals for January (6,557) and February (7,090).
Steve Wood, CEO at the NHBC, said: “Our (quarter one) 2024 figures reflect prevailing market conditions. Rises in the Bank of England’s base rate have driven mortgage rates higher, leading to a drop in new home purchases and a slowdown in house price growth.
“Prolonged wet weather has also hampered house building output in (quarter one).
He added: “House builders are cautiously optimistic and it is encouraging to see signs of growth, with a month-on-month increase in registrations since January.”
Mr Wood also highlighted a “skills gap”, with extra workers needed to meet construction demand.
The NHBC said that registrations of apartments have held up relatively well compared with other property types, which it said is due to the relative strength of the rental and affordable sector.
Mr Wood added: “Build volumes are anticipated to rise in the second half of the year as economic conditions begin to improve and consumer confidence starts to recover…
“We are seeing early signs of growth returning to the private sector, and affordable house building is holding up well, but skills and planning challenges must be addressed to truly accelerate market recovery.”
The Bank of England decided to keep the rate unchanged at 5.25% last week, although governor Andrew Bailey said he is “optimistic that things are moving in the right direction”.
The number of mortgage approvals made to home buyers jumped in March to the highest level since September 2022, according to recent Bank of England figures.
But the Royal Institution of Chartered Surveyors (Rics) recently reported that new home buyer inquiries fell back in April following three months of increases in a row.
Rics said the regional feedback on buyer demand is mixed, with a notable loss of momentum mainly seen in London and southern parts of England.
Here are the numbers of home registrations in the first quarter of 2024 and the annual change compared with the first quarter of 2023, according to the NHBC (nine areas recorded a decrease in registrations and three recorded an increase):
– North East, 1,250, minus 19%
– Yorkshire and the Humber, 1,578, minus 18%
– East Midlands, 1,755, minus 43%
– Eastern England, 2,766, minus 29%
– London, 2,429, 2%
– South East, 3,455, minus 7%
– South West, 2,281, minus 21%
– West Midlands, 1,963, minus 21%
– Wales, 382, minus 43%
– Northern Ireland and Isle of Man, 629, 23%
– North West, 1,609, minus 41%
– Scotland, 1,870, 4%