Housebuilding rise welcomed, but with caution

Posted: 23 Aug 2010 11:39:56 GMT

A rise in the number of homes being built has been welcomed by the Royal Institution of Chartered Surveyors (Rics), but it noted the level of new starts has declined.

Data from the Department for Communities and Local Government showed 28,590 new homes were started in the second quarter of the year, which Rics chief economist Simon Rubinsohn noted was the highest tally since 2008 and up by a third on the opening quarter of the year.

However, he noted, there have been signs of these declining, adding: "While on the face of it this appears encouraging, there are good reasons for questioning whether this more positive trend will be sustained for the rest of this year and into 2011."

Mr Rubinsohn pointed to data from the latest Rics Construction Market Survey, showing new enquiries to start housing projects fell in the second quarter.

A drop in housebuilding was predicted as an element of the "short-term pain" that was inevitable as a result of the Budget in June, director general of the Council of Mortgage Lenders Michael Coogan said after the speech.
 

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