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OBR forecasts 250,000 homes a year
England will see around 250,000 new homes built a year for the next five years, the Office for Budget Responsibility (OBR) has predicted.
The forecast suggests the government could struggle to meet its target of delivering 300,000 homes a year by the mid-2020s.
In its housing supply forecast, published this morning for the first time, the OBR predicted that 233,430 homes would be added to the housing stock in 2017/18 and that this would increase over the next five years to an average of 249,282 homes a year.
This figure is well below what would be required for housing supply to reach the 300,000 yearly mark. The OBR does not forecast as far as the mid-2020s, but it predicts no major increase beyond 250,000 in the next five years.
The forecast was under particular scrutiny last week when the OBR announced that it would not be changing its predictions for housing delivery based on the chancellor’s Autumn Budget – which contained a number of measures explicitly aimed at increasing housing supply.
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It noted: “While there has been some recovery in the pace of housing starts in recent years, it is difficult to distinguish the effect of changes in the planning system from the more general recovery in housing market activity – and housing starts remain below their pre-2008 levels.
“Given this, we have not made any further adjustments to our forecasts at this stage. We will keep these judgements under review as the policies are delivered and new evidence becomes available.”
A government spokesperson said: “We are committed to fixing our broken housing market and building the homes this country needs. The OBR says it will keep its forecast under review as Budget policies are delivered.
“Currently the OBR modelling uses a top-down approach based on interest rates and property transactions rather than a bottom-up assessment of the number of housing starts delivered by different schemes.”
