Figures released today by CLG show how the Government’s Help to Buy Equity Loan scheme is driving new home building activity.
There were 28,580 new homes started by private house builders in England in the July, August and September quarter this year – up 29% on the same period last year. It is the highest number of new homes started in a quarter since Q1 2008.
The figures show confidence is returning to the house building industry aided by the launch of the Help to Buy Equity Loan scheme in April. The biggest constraint on supply since 2008 has been people’s inability to buy. The Equity Loan scheme is delivering around 2,500 new home reservations a month enabling builders to ramp up production on site. Since April it has resulted in over 18000 reservations, mostly to First-Time Buyers.
Builders are building out existing sites more quickly and looking to start on new sites sooner.
Speaking today, Stewart Baseley, Executive Chairman of the HBF, said:
“Help to Buy is increasing demand for new homes and the industry is responding. People’s inability to buy in recent years has been the biggest constraint on the industry’s efforts to build more homes. If people can buy, builders will build. Help to Buy is allowing people who can afford to buy a home to do so, meaning builders can get on with building the homes the country needs.”
“As a result of this increase in activity, the industry is recruiting significant amounts of people. The supply chain is also gearing up to meet the increased level of demand, generating an economic boost the length and breadth of the country”
Jeff Fairburn, Chief Executive of Persimmon said:
“The Equity Loan element of Help to Buy is already having a meaningful impact on the housing market, by addressing the issues of restricted mortgage availability and large deposits that were preventing many potential homeowners from buying a home of their own. To increase volume to meet this increased demand, we are stepping up our investment in land and construction, opening 85 new sites before the end of the year and developing on all sites where we have implementable planning consents, creating many new jobs in the process.
“The forthcoming Mortgage Guarantee element will address the same issues in the much larger market for second hand homes and the anticipated increased activity in the wider housing market should also provide a further boost to market confidence and volumes in the new build sector.”
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