Private housing starts up 40%
Private housebuilding starts were up 40% during the second quarter of 2012, compared to the same period in 2011, according to new figures from construction data firm Glenigan.
It is a welcome morale boost for the industry, and follows a 30% year-on-year rise in Q1.
Glenigan also reported a 57% increase in detailed planning approvals in the three months to May, and forecasts a 29% increase in the underlying value of project starts over 2012, with growth expected to continue through 2013.
House-building activity shrank by 3% during 2011.
London and the South East continue to dominates the market having accounted for almost a third of the value of all new private housing schemes starting on site in the first half of 2012.
Allan Wilén, economics director at Glenigan, said: “The weak economy and a banking sector that is seemingly loth to lend have constrained the private housing market over the last two years. Capital is still at a premium and banks are charging relatively high prices for access.
“However, developers have cited increased demand from first-time buyers, spurred on by government incentive schemes, as one of the main reasons behind an increase in building. Such measures, combined with historically low interest rates and further liquidity being pumped into the UK economy, have created favourable conditions for first-time buyers, who have historically been the main drivers of the housebuilding sector.
“While the threat of an increase in interest rates and the end of the stamp duty holiday have stymied the market to a certain extent, we expect the sector to continue to grow through 2012 and 2013 as the wider economy begins to recover once more.”
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This article was published on 16 Jul 2012 (last updated on 17 Jul 2012).