(Bloomberg) -- The number of new homes completed in England has fallen to the lowest since 2020’s first Covid lockdown, revealing the scale of the task facing Prime Minister Keir Starmer in meeting his ambitious housebuilding target.
The Office for National Statistics said Thursday that completions fell to 31,670 in the first quarter, a slump caused by the slowdown in the property market after mortgage rates surged last year. It was a quarter fewer than in the fourth quarter of 2023 and down 15% from a year earlier.
The figures lay bare the challenge confronting the new Labour government, which has pledged to boost the number of net additional dwellings — a gauge that includes conversions as well as new builds — to 1.5 million in England over five years. Even that target may not be enough to keep pace with a rising population.
Given the delay between housing starts and the developments being finished, the data suggests that housing completions may also be subdued at the start of Starmer’s premiership after he won the July 4 election. Housing starts were 23,730 in the first quarter, up slightly from the 15-year low hit in the fourth quarter of 2023 but still down almost 40% on a year ago.
Labour plans to spur a housebuilding boom and drive economic growth by overhauling Britain’s slow and costly planning system. The Conservative government struggled to meet its own pledge to lift housing supply by 300,000 per year by the mid-2020s, with younger voters who can’t get on the housing ladder deserting the party at the election.
Survey data has pointed to housebuilding picking up in recent months as the housing market recovery gains pace. Economists at Nomura estimate that Labour delivering 300,000 homes per year would lift the level of GDP by as much as 0.8%.
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