The number of new homes being built soared by 33% in the three months to the end of September to reach a 15-year high.
A total of 44,729 homes were started during the period, the highest figure for the third quarter since 2007, according to the National House Building Council, which provides a warranty on new homes.
The figure builds on the more than 112,000 homes that were started in the first half of the year, setting 2022 up to be a strong year for new-build homes.
Within the total for the latest three months, 32,702 of the properties will be sold in the private sector, with more than 12,000 ear-marked for affordable housing and build to rent.
Steve Wood, NHBC chief executive, said: “In part this is the ‘bounce-back’ after the pandemic, but it also reflects a confidence that the underlying demand for new homes is holding across a range of tenures.”
However, he added that as housebuilders and homebuyers became more cautious in the face of the cost-of-living squeeze, rising interest rates and economic uncertainty, the rate at which new properties are being built is likely to slow down in future.
Why is this happening?
The housebuilding industry was hit hard by the Covid-19 pandemic, with lockdowns limiting the number of people who were allowed to work on site, leading to fewer homes being built.
But the recovery from the pandemic only partially explains the strong rise in new-build properties going up.
The increase was also driven by significant demand from buyers, particularly first-time buyers looking to take advantage of the Help-to-Buy equity loan scheme before it closed to new applications at the end of October this year.
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What type of new homes are being built?
House-builders are responding to consumers’ demand for more space following the reassessment of their housing needs during the pandemic.
As such, more than a third of all new homes started during the three months were detached houses, while 30% were semi-detached properties.
There was also a big increase in apartments being built, with these rising by 114% year-on-year, largely due to a surge in activity in London, which accounted for 45% of the total.
There was also good news for renters, with the number of homes going up for social housing or build to rent rising by 55%.
Build to rent provides homes that are designed and managed specifically for renters.
They often come with a range of high-end facilities, such as gyms, cinemas, communal chill-out zones, gardens and concierge services, which are often all included in the rent.
Where are the properties being built?
The number of new homes being built increased in 10 out of the 12 regions of the UK.
London saw the biggest jump with new starts soaring by 277%, followed by Wales with a 65% rise and Scotland with a 64% increase. Activity was also strong in the West Midlands, growing by 48%.
In terms of the number of homes started, the North West led the way with 5,602 properties under construction, closely followed by Eastern England and East Midlands at 5,342 and 5,184 respectively.
Northern Ireland and the South West were the only regions in which house building levels dropped, with developers in these regions reporting a slightly cooler market.