Rightmove has reported that the number of new-build housing developments coming to market has fallen to its lowest level in almost a decade, with May figures showing the fewest since January 2017. The property platform, which has tracked for-sale listings for over ten years, analysed entire developments rather than individual homes, highlighting a persistent shortage of affordable housing.
Market context and overall supply
Despite the slump in new-builds, the overall number of properties for sale—including existing homes—has risen by 85% compared with four years ago. Colleen Babcock, Rightmove’s property expert, said: “Despite the historically high number of available homes for sale, there is still a long-term shortage of affordable homes in the right place. We need more homes to support people at every stage of the moving journey, from first-time buyers to downsizers.”
Government targets under pressure
The government has set a target of building 1.5 million homes over this parliament to boost affordable housing and assist first-time buyers. However, Rightmove’s data suggests the UK is not on track to meet that goal, even after planning reforms aimed at cutting red tape. Housebuilders must allocate a portion of new developments as affordable housing under government quotas, but the low supply of new-builds threatens these requirements.
Construction industry challenges
The S&P Global UK construction PMI for May showed activity declining at the fastest rate since the height of the Covid-19 pandemic, with builders citing project delays, hesitancy in investment decisions, and reduced customer budgets. The construction sector has been in a prolonged slump for around 18 months.
Barratt Redrow, the UK’s largest housebuilder, is moving ahead with plans to close nine offices to cut costs. Sales and marketing director Steve Mariner commented: “Government has made good progress reforming the planning system, helping unlock more land for development. However, increasing regulatory costs are holding new homes back, while low customer confidence, higher borrowing costs and wider economic uncertainty are all making it harder for first-time buyers to get on to the housing ladder.”
Call for stamp duty reform
Rightmove is urging the government to scrap stamp duty for first-time buyers on both new-build and resale properties. Stamp duty relief on higher-priced homes was removed last year, increasing the tax burden for some buyers. The property platform argues that such a measure would help address the affordability crisis and support first-time buyers in a challenging market.
