Winter market surge not enough to prevent new build slump

Covid-19 has caused the number of new homes registered by UK house builders to fall 23 per cent in 2020.

The NHBC trade body and insurance provider says this slump comes despite a surge in late 2020 as the market came back to life.

NHBC registered 123,151 new homes in 2020, compared to 160,319 in 2019. 

The largest falls were in the second quarter of last year as the initial lockdown halted work on site. 

House building activity rebounded quickly after builders established Covid-secure working practices in the summer, with a total of 39,749 new homes being registered in the final quarter, 34 per cent up on the third quarter.

The numbers of new home registrations fell in every UK region in 2020, with South East England and Scotland down 28 per cent, and Northern Ireland down 38 per cent. 

In more detail, the data indicates that many UK cities saw greater falls in new home registrations than their wider regions; for example, Manchester dropping 42 per cent in 2020 versus 2019, compared with 27 per cent in the whole North West. 

London and Glasgow were the only major cities to buck this trend.

New home registrations in the private sector fell by 26 per cent to 81,067, with the affordable and Build To Rent sector seeing a more limited fall of 16 per cent to 42,084, compared to the previous year.

NHBC chief executive Steve Wood says: “Against the backdrop of the Covid-19 pandemic, the new build housing market has held up very well, with house builders showing resilience and adaptability throughout 2020.

“Last spring saw a sharp shock to the housing market and it is heartening that by the close of 2020, productivity levels had moved very close to those seen in late 2019.

“Confidence in the housing market, particularly for newly-built homes, remains strong with many larger house builders forward sold into the summer despite the continued impact of the pandemic and prevailing economic uncertainties.”