UK Housing Supply Declines to Eight-Year Low

Annual housing supply in England has dropped by 6%, marking the lowest level since 2015/16, as new builds fell to 221,071 units, down from 234,292 in the previous year. This decline poses a significant challenge for the Labour government, which has pledged to construct 1.5 million homes over five years. Factors contributing to this shortfall include construction capacity constraints, economic pressures, and a lack of planning approvals, with only 235,000 homes receiving consent in the past year. In the U.S., single-family home construction also experienced a decline of 6.9% in October 2024, attributed to recent hurricanes and high mortgage rates, although multifamily housing starts showed some growth. Both regions face challenges in meeting housing demands due to high borrowing costs and limited new inventory. Experts suggest that fostering a more competitive investment environment and empowering smaller developers could help address these shortages.