Cushman-Wakefield-Q4-2022-BTR-Report
CONSTRUCTION
A SLOWDOWN IN NEW HOMES DELIVERY
ENGLAND CONSTRUCTION STARTS & SALES
10 K 15 K 20 K 25 K 30 K 35 K 40 K 45 K 50 K 55 K 60 K
100K 133K 167K 200K 233K 267K 300K 333K 367K 400K
The construction of new homes in England is expected to have slowed as housebuilders face economic headwinds . When the residential sales market slows , housebuilders reduce construction . This is partly a consequence of the perverse incentives that the supply - demand dynamics of our housing market create for housebuilders , which also deepens its cyclical nature . In London , construction starts for homes for private sale have been slowing for several years . This market has faced various risks over the last few years , including Brexit , the pandemic , the end of Help to Buy , increased construction costs , and various economic and political headwinds . This , combined with the growth in the private rented sector , has led to a decline in construction starts on homes for sale in London . Build to Rent delivery , on the other hand , remained strong in 2022, with 5,640 Build to Rent starts , 30% more than in 2021. Last year , Build to Rent accounted for 31% of all new home starts . This is higher than in 2021, when only 26% of starts were Build to Rent . With a large amount of capital still targeting the living sector , we expect Build to Rent to play an important role in the delivery of new homes across the UK , particularly when the sales market is more vulnerable . While there are still challenges , most notably debt and construction costs , the strong fundamentals of the rental market will continue to attract investment .
Starts ( LHS )
0 33K 67K
Sales (RHS)
0 5 K
Q 2 2011
Q 2 1997
Q 2 1995
Q 2 2021
Q 2 2017
Q 2 2012
Q 2 2015
Q 2 2013
Q 2 1998
Q 2 2018
Q 2 1996
Q 2 1999
Q 2 2019
Q 2 2016
Q 2 2014
Q 2 2010
Q 2 2001
Q 2 2022
Q 2 2007
Q 2 2020
Q 2 2002
Q 2 2003
Q 2 2005
Q 2 2008
Q 2 2006
Q 2 2009
Q 2 2004
Q 2 2000
Starts ( LHS )
Sales ( RHS )
LONDON CONSTRUCTION STARTS
35,000
30,000
25,000
20,000
Type something
15,000
10,000
5,000
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Build to Rent Starts Build to Sale Starts All Starts
Cushman & Wakefield, Molior, UK HPI, GOV.UK
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