Affordable homes hit 20,000 in the east as construction output brings a late boost to GDP
- Credit: PA
Britain's economic growth for the first quarter looks likely to be revised up to a near four-year high after official figures showed the construction sector performed much better than previously thought.
The Office for National Statistics (ONS) said construction grew by 1.5pc in the first three months of 2014, up from a previous estimate of 0.6pc. But the buoyancy in the market came despite new orders for public housing recording their biggest fall since records began in 1964.
The ONS said the 45.7pc drop might be because investment in housing associations was coming from the private sector rather than public sources.
According to the government, more than 20,000 affordable homes have been built in the East of England since April 2010. The number counts towards the 200,000 affordable homes built across the UK over the same period.
Chancellor George Osborne has unveiled his plans to fix Britain's housing market with beefed-up powers for the Bank of England and 'radical' planning reforms designed to help build up to 200,000 new homes.
In his annual Mansion House speech, he set out how the Bank's financial policy committee would be able to order restrictions on the ratio of mortgage loans compared to borrowers' incomes, or to the value of their house. But alarm bells sounded for homeowners yesterday when the Bank of England governor Mark Carney said that interest rates could rise by the end of this year.
John Whitelock, the development director for the Norfolk-based Saffron Housing trust, welcomed the growth in the construction sector – and said it would only be a matter of time before more social housing was built.
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'The delivery of social housing will only increase when the market is able to deliver more homes,' he said. 'The low results for new orders from the ONS appear to show the tail end of the construction slump seen in the economic downturn that we are now coming out of.'
He believes that the number orders will now improve as the market starts strengthen.
'Twenty thousand affordable homes built across the East of England shows really positive growth,' he added. 'But we need to do more and we need to increase the supply, but it is only when more houses are delivered that the market will become more stable.'
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