Net Housing Supply powers past long term average for the first time since recession
• The supply of new housing in 2014-2015 increased to more than its long-term average after a 25% surge year on year;
• Three quarters of the increase came from New Build (+19% y/y) and a quarter largely from a surge in Change of Use (+65% y/y);
• Next statistical release to look out for: House Building Starts and Completions data from DCLG due on November 19th.
Net Housing Supply in England has recovered to its long term average after a 25% surge year on year according to latest figures from DCLG. The number of net additional dwellings rose to more than 170,000 in 2014/15 from a post-recession low of 135,000 in 2011/12.
Growth was driven by an increase in new build completions which increased by around 25,000 (+19%) y/y and change of use which increased by around 8,000 (+65%) y/y. Change of use growth has been boosted by permitted development rights, first introduced in 2013, which fast track the conversion of vacant office buildings to residential use. These rights, initially a temporary measure to speed up housing delivery, are intended to be made permanent in the Housing and Planning Bill and extended to laundrettes and light industrial buildings.
However, three quarters of the increase in supply came from new build completions. So where has this growth in new builds come from? As previous HFi analysis has discussed, 2015 has seen a marked recovery in private enterprise house building. It is worth noting that Housing Association builds have also been in the top end of their long-term range.
Net supply of housing is released annually and sourced from planning teams at local councils. With a long window for data collection that closes five months after the end of the financial year it provides a more complete picture of new housing supply including conversions, change of use and demolitions. Watch out for upcoming house building starts and completion data from DCLG due for release tomorrow 19th November at 9.30am.