Whilst the number of homes built in the UK last year remains higher than the 20 year annual average, there was an -11.8% year on year drop of housing delivery- the first annual decline seen since the pandemic
The housing delivery decline was observed in industry analysis from property development appraisal software, APRAO.
Using data from the Office of National Statistics on the number of new homes delivered in 2023, APRAO compared these figures to the volume of delivery in previous years.
The year on year housing delivery decline is only the second to be observed in new builds specifically since 2016.
189,260 new homes were completed last year
The figures show that 189,260 new homes were completed across the UK in 2023, marginally higher than the annual average of 188,290 seen over the last two decades.
However, this total was -11.8% down on 2022’s figures(214,589), marking an end to two years of positive growth in housing delivery levels.
The number of new homes peaked at 214,150 in 2019, but fell to 173,584 in 2020 after post-pandemic complications.
Since then, the number of permanent dwellings completed has been climbing.
While all home nations have seen the volume of new homes delivered decline on an annual basis, this reduction has been most pronounced across both Wales and Northern Ireland, with year on year drops of -22.3% and -21.3% respectively.
As a result, the annual number of new homes delivered across both nations in 2023 sat below the 20 year annual average.
This decline has been less prominent across England (11.1%) and Scotland (-11.4%), although the level of new homes delivered has still fallen by more than 11% across both nations.
Despite this decline, both nations saw housing delivery remain ahead of the 20 year annual average in 2023.
A ‘difficult landscape’ for buyers and builders
CEO of APRAO, Daniel Norman, commented: “There’s no doubt that higher interest rates, untamable inflation and a cooling housing market have had a notable impact on the delivery of new homes across the UK market.
“In fact, the number of permanent dwellings delivered on an annual basis has fallen for the first time since the pandemic and for only the second time since 2016.
“While this decline has been more pronounced across some parts of the UK compared to others, new home delivery is down across the board and this really highlights just how difficult the landscape has been, not just for homebuyers, but for the nation’s housebuilders.
“The expectation is that while 2024 is set to be a more stable year, market conditions are predicted to remain subdued until interest rates do start to reduce. With this yet to happen, the likelihood is that we will see another year of muted housing delivery.”
