Housebuilding, which has been leading the construction industry out of recession, is forecast to grow 55% to 167,000 new homes a year according to forecasts from real estate adviser Savills. But Savills warn that even their best case scenario for housebuilding will not create enough houses to satisfy needs.
A steep rise in housebuilding by the public sector is forecast to support the growth in output to 167,000 new homes a year by 2018, compared to the 2013 total of only 108,000. Even with this forecast growth however Savills warns that England alone will still be well short of the 240,000 new homes estimated to be needed each year to keep pace with demand.
Housing associations are expected to take the lead in public sector growth and are forecast to account for 20% of new housebuilding by 2018 creating local employment opportunities. Local authorities are also forecast to increase their housebuilding efforts from 1,655 this year to 10,000 in 2018.
The private sector is forecast to increase production by eight per cent a year in the five years to March 2018 to 107,000 new homes a year, a rise of 35% overall increasing recruitment of technical staff. This compares to the 203,320 homes built by the private sector in the peak production year of 1968, and the 2007 total of 154,210.
Savills director of residential research Susan Emmett said: “Historically, we have seen periods of similar growth in the 1980s and noughties but there is no precedent for faster growth over a sustained period,” says.
“Our forecast is therefore the best case scenario for private sector expansion and very much dependent on finance easing for SMEs. Indeed, we have made some robust assumptions about increase in output from both the private and public sector. It is worrying that even a best case scenario is still not good enough to meet our housing need.”
Photo: Lee Haywood