New figures suggest Help to Buy is driving the building of new homes

But critics say that more needs to be done to tackle national housing crisis

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The Independent Online

A total of 28,580 new homes were started by private house builders in England between July, August and September, according to the latest government report, up 29 per cent on the same period last year.

It suggests that the figures show confidence is returning to the house building industry helped by the launch of the Help to Buy Equity Loan scheme earlier in the year.

Stewart Baseley, Executive Chairman of the Home Builders Federation, said: "Help to Buy is increasing demand for new homes and the industry is responding. People’s inability to buy in recent years has been the biggest constraint on the industry’s efforts to build more homes. If people can buy, builders will build. Help to Buy is allowing people who can afford to buy a home to do so, meaning builders can get on with building the homes the country needs.”

Mark Clare, Chief Executive of Barratt added: "If we can sell homes more quickly we can build more quickly and we are rapidly increasing production.  We now have the confidence to target the construction of 45,000 homes over the next three years and we are investing in land and bringing it through planning to meet increased demand.  We are also expanding the business by taking on 600 new apprentices and graduates to tackle the skills shortage that could constrain future growth.”

But Grainia Long, chief executive of the Chartered Institute of Housing (CIH), said the figures also showed worrying elements.

"While it is encouraging to see increases in starts and completions in the three months to September compared with the previous quarter, these figures show we are still nowhere near tackling our national housing crisis which is causing misery for millions of people who are unable to secure a decent home at a price they can afford," she said.

"Annual housing completions dropped eight per cent in the year to September to 107,950, less than half the number we need to be building to accommodate our growing population.  It is also deeply worrying to see a 25 per cent drop in the number of new build affordable homes provided in 2012 to 2013."

Campbell Robb, Shelter’s chief executive said that the figures showed that Help to Buy was failing to deliver the volume of new homes needed. "We’re building less than half of the 250,000 homes needed each year just to keep up with demand, ," he said, "and the small increase in house building starts is no way near enough to get close to this total. Worryingly the number of affordable homes built has fallen significantly, spelling disaster for the thousands of families we see every day who are struggling to cope with soaring housing costs.

"In a property market that’s already heating-up with pent-up demand, Help to Buy is a backward step. If the government is really committed to rolling up its sleeves and getting more homes built, there are plenty of more straightforward ways to do it than relying on state mortgage guarantees to fuel debt. Freeing up local authorities to build, planning new garden cities and improving access to land that can be built on are all good places to start.

"For many young people on average incomes a 95% mortgage with Help to Buy simply isn’t affordable and, coupled with rising house prices, sees the dream of a home of their own slip further and further out of reach."

Richard Sexton, director of e.surv chartered surveyors, said: "We must not get too swept away, as we could see something of a New Year hangover as the initial blast of buyers drawn in by Help to Buy dies down and media attention dwindles. While the forthcoming Mortgage Market Regulations could also further put the footbrake on as lenders look with more caution. Coupled with this we have a severe shortage of housing, which could threaten house prices rising out of reach if it isn’t addressed imminently. While we already have Help to Buy, what we really need now is a ‘Help to Build’ scheme, and this should be a government priority moving into 2014.”