New Home Registrations Up in Q1 Despite Materials Shortages

NEW BUILD HOME registrations were up 10% in Q1 2021 compared to the same period in 2020, according to figures released today by NHBC, the new home warranty and insurance provider.

This year’s first quarter figures follow a strong recovery in Q3 and Q4, showing that the sector has bounced back.

36,863 new homes were registered with NHBC in the first quarter of 2021 compared to 33,388 in the same period last year. House completions were also up at 33,074 – a 4% uplift on Q1 2020 (31,652).

Private sector registrations were up 10% compared to Q1 2020, from 24,615 to 26,985, whilst the rental sector saw registrations up 13% to 9,878 (8,773 in Q1 2020).

Material Shortages

NHBC says that house builders report some disturbance from the unexpected surge in demand, partly due to the stamp duty holiday and Help to Buy scheme. However, they have had no real problems with materials or labour shortages.

NHBC’s Commercial Director, David Campbell, cautions that the impact of shortages depends on their duration and may yet translate into new home price rises in a year or two. Asked if house builders are monopolizing the available materials while other contractors go short, NHBC Chief Executive, Steve Wood, said, “There’s no evidence of that. But house builders will want to support their businesses and if it’s happening it’s not necessarily surprising.”

Detached Houses and Apartments

The desire for longer-term working from home has been accelerated by the pandemic, with increased registrations for detached and semi-detached houses, up 18% and 30% respectively compared to Q1 2020, whilst 21% fewer apartments were registered. Steve Wood expects the drop in new apartments being built to be temporary. He says that the real estate sector, including agencies such as Right Move are seeing more interest in London and urban living indicating that young people will return to the cities and drive demand again.

Regional Registrations

Nine out of 12 UK regions have seen increased registrations in Q1 compared to last year, with the highest uplifts in the North East (+61%), Eastern (+42%) and South West (+31%).  Reflecting the pandemic trend of house buyers moving out of cities and urban settings, London (-29%), West Midlands (-21%) and Wales (-14%) were the fallers.

Regional Registrations Q1 2020 vs Q1 2021

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