Housebuilding rate 'will not keep pace with demand'
The rate of housebuilding is set to undergo a substantial rise over the next five years but it will still not be enough to keep pace with rising demand.Output from developers across all sectors is expected to reach 167,000 a year by 2018. A sharp rise in output from the public sector will drive this growth, according to a new forecast published by global real estate services provider Savills.Despite this encouraging trend, which represents a 55 per cent increase on the 2013 total of 108,000, the rate will fall short of the 240,000 a year required to meet demand in England. Private sector production is forecast to grow by eight per cent per year to March 2018. This represents a 35 per cent increase over the five-year period and would result in an average annual output of 107,000.During 2014, the housing recovery is expected to expand beyond London. Local authorities and housing associations are expected to play an increasing role in delivery.Susan Emmett, Savills director of residential research, said the forecast is a best-case scenario as there is no historical precedent for a sustained period of faster growth. It rests on several "robust assumptions", including SMEs gaining better access to finance.Construction peaked in the UK in 1968, when output reached 203,320 homes. Even during 2007, output stood at 154,210 and the forecast for the next five years falls far short of this."It is crucial that that building numbers continue to grow," Ms Emmett commented. "The burden of meeting the country's growing housing need cannot be placed on the private sector alone. Encouraging a greater variety of players to deliver new homes, as well as promoting different routes to market, such as build to rent, would be a great step forward."Local authorities are expected to deliver more homes - provision is forecast to rise from 1,665 this year to 10,000 in 2018. Housing associations are set to deliver 26,000 new homes in 2014 and 34,000 in 2015, up from 22,000 completions in 2013.
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