Private sector home completions plummet, while rented and affordable homes skyrocket

Figures released by the National House Building Council (NHBC), provider of new home warranties and insurance, show 133,213 new homes were completed in 2023, down 12% on 2022 (151,308).

Private sector completions were down 20%.

However, 45,649 new homes were completed in the rental and affordable sector, up 10% on 2022 and the highest figure ever recorded by NHBC.

In 2023 there was a decrease in new home registrations — the process by which a developer registers their intent to build a new home - to 105,449, compared to 189,009 in 2022. Across the UK, all regions saw a fall in registrations, with the biggest drops in Northwest (-61%), West Midlands (-59%) and Eastern region (-52%).

Private sector registrations were hit hardest, down 53% on last year (64,877 vs.136,805 in 2022).

The rental and affordable sector saw a shallower decline with 40,572 registrations in 2023, down 22% on the previous year (52,204). 

Steve Wood, CEO at NHBC, said: “Whilst there were considerable supply and demand pressures on the new homes market in 2023, it is very encouraging to see record numbers of new home completions in the affordable sector.

“Several major housebuilders have partnered with housing associations and BTR providers, re-focusing parts of their output to help address the demand for affordable homes.

"The backdrop of high interest rates, significant inflationary pressures and challenges with planning consents has supressed private sale output in 2023

“That said, there are some signs of demand returning to the market and we would expect an improved position in 2024 as consumer confidence begins to recover and mortgage rates start to fall.”

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