Government set to miss new home building targets
Monday, 06 Oct 2008 08:40
UK not building enough
Less than 100,000 new homes will be built next year, half the amount needed to meet government targets.
The Royal Institution of Charter Surveyors (Rics) finds the downturn in the construction industry means the government target of two million new homes by 2016 is untenable.
So far this year 66,220 homes have been built – but Rics claims 200,000 a year must be built to hit the targets.
Oliver Gilmartin, Rics senior economist, said: "With finance for projects becoming increasingly difficult to obtain, the government’s ambitious target of two million new houses a year by 2016 is likely to fall well short.
"At current levels of production the number of new homes built will fall below 100,000 in the coming year."
The Rics UK Construction Market Survey shows overall construction workloads declined at their fastest pace on record with 38 per cent more chartered surveyors reporting a fall than a rise. Some 41 per cent Rics members expect workloads to fall rather than rise over the coming twelve months as financial constraints continue to bite.
As well as hitting home building, the credit crunch is also making larger public projects more difficult to finance, the survey found, meaning delays and scaling back of developments.
Mr Gilmartin added: "The outlook for the construction industry is extremely bleak with the previously strong infrastructure sector now unlikely to step in as the downturn in property markets resonates.
"A rapid solution to the log jam in credit markets is necessary to limit the severity of the current downturn which is starting to affect the country’s infrastructure."