Assetz® News - UK house building is "booming"

UK house building is "booming"

6th March 2006 |

In more good news for the strengthening UK property market, the Campaign to Protect Rural England (CPRE) has suggested that house building is again "booming".

Property investors had been concerned over a downturn in construction last year, as first-time buyers left the market and demand fell away across the country. The CPRE is now telling the government that the situation is extremely good, arguing that any prospective policy changes would be unnecessary.

The Office of the Deputy Prime Minister recently announced that 160,000 new homes were completed in England last year, which is the highest figure since back in 1990. Furthermore, the last six years have seen house building grow by a fifth, indicative of the sustained vigour of the industry.

There has been a push recently from a number of construction companies for changes in legislation that would allow planning permission to be granted more often than is currently permissible. This may well happen in the next couple of years, but the CPRE is satisfied that the existing rules are promoting sufficient activity in line with the growth of the market.

"The planning system has enabled a steady, strong growth in the building of new homes since the current policy was introduced by Mr Prescott in 2000 - exactly six years ago this week," said CPRE's planning and housing campaigner Henry Oliver.

"At the same time we've had a big increase in the use of derelict or under-used land for new homes. This has helped to protect the countryside and the wider environment while contributing massively to urban regeneration," he added.

Only days into his new role as leader of the Liberal Democrats, Sir Menzies Campbell has outlined a strategy that will reassert the party's reputation as committed to environmentally friendly policy, which may lead to a general shift of emphasis across the political spectrum.

In terms of housing, this would clearly point to an avoidance of building too heavily on current greenfield sites – a trend that would certainly please Mr Oliver.

"While the Treasury, the house builders and other development interests are piling on the pressure for a weaker, market-driven approach to how we plan for new homes, it's clear the present policy has actually delivered six years of success," he said.

"It's one of the most environmentally friendly policies the government has ever introduced, one that really does approach sustainable development.

"If it ain't broke, don't fix it," he added.

Recent evidence would certainly suggest that the property market is progressing comfortably, with Hometrack showing that house prices rose steadily for three consecutive months and companies such as Barratt Homes indicating that they are on track for record sales.

While many would like to see the regulations on building residential property loosened, the opposing argument for a continuation of the present system is clearly also convincing.

As long as demand for property remains high, the market will continue to grow, making property investment all the more lucrative in the years to come.