"It is too early to judge how long any slowdown is likely to last; housebuilding continues to show resilience"
While private sector registrations saw the biggest decline at 28% down to 23,203, quarter on quarter, those for the Affordable and Build to Rent sectors were less affected during the quarter, at 3% down to 11,838 homes. NHBC said the cost of living crisis had increased demand for affordable homes and the BTR sector was still enjoying “significant levels of investment”.
NHBC’s statistics also show that in Q4, ten out of 12 UK regions witnessed declines in registrations against the previous quarter. London suffered the worst at a 63% drop. This was followed by the North East at -47%, with Wales, the North West and Merseyside joint third at a 33% decrease in new homes registered that quarter.
For 2022 as a whole, 191,801 new homes were registered, rivalling the high of 2007’s 198,467. Of these, 141,757 were for the private sector, up 25% on 2021. Affordable and BTR registrations during the year increased by 29% to 50,044.
And in 2022, 11 out of 12 regions saw registration growth.
After a difficult Q4, Steve Wood, NHBC’s CEO, said the organisation was seeing “some early indicators that enquiries for new build homes are easing up which is perhaps a sign that people need to get on with their lives”.
David Campbell, NHBC’s commercial director, said that while the first quarter of 2023 was likely to be challenging for housebuilding, he saw reasons for “cautious optimism”, with housebuilders historically coping well in tough circumstances, partly helped by the ongoing supply and demand imbalance.
He commented: “As one might expect, many [builders and developers] are considering the viability of launching new projects to the market very carefully, particularly in light of the latest Bank of England base rate rise, but there are signs that this will be temporary as enquiry and reservation levels begin to rise.”
Steve Wood said NHBC’s data illustrated the shifting economic climate.
He added: “Whilst the final quarter of 2022 was undoubtedly a challenging one, it was off the back of strong market performance in the first half of the year.
“Rising interest rates and the cost-of-living crisis have had a marked impact on many areas of the UK economy. Housebuilding has not been immune from these factors but the demand for high-quality new homes, whether in the private or rental sector, is still holding up. It is too early to judge how long any slowdown is likely to last; housebuilding continues to show resilience.”
