Preliminary
data indicates that total residential output increased by 5% in 2018 to
£74.2bn, according to the latest Construction and Housing Forecast Bulletin
from AMA Research.
This
was underpinned by 8% increase in new work but with residential RMI remaining
static at £30bn.
Whilst
both housing starts and completions have remained positive in 2018 there is
some evidence of a slowing of the growth rates for both starts and completions
into H1 2019.
In
addition, the rate of annual house price growth has also slowed in Q1
2019. The Spring Statement in March 2019 also provided good news for the
public housing sector with the confirmation that up to £3bn of borrowing by
housing associations in England will be made available under the Affordable
Homes Guarantee Scheme in order to support the delivery of 30,000 affordable
homes.
Future
prospects for the new housebuilding sector in Great Britain into the
medium-term will be heavily influenced by the issues of affordability,
availability of mortgage finance and levels of consumer confidence.
Into
H1 2019, these factors have been less resilient than during 2018, indicating
that the more cautious approach applied by businesses over the last year has
also percolated into the new housebuilding sector.
However,
the outlook for residential construction remains positive, if modest, with 21%
overall growth in output currently forecast between 2018 and 2023.
The
imbalance between demand and supply for new housing will remain one of the key
drivers for continued output growth for the residential sector.
The
number of new programmes designed to address shortage in housing stocks should
motivate output into the medium-term.
