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Fall in housebuilding adds to pressure on prices

Fewer homes were built last year than in any year since 1950, adding to pressure on the surge in property prices, according to research from Halifax.

The total number of new homes built in the UK fell by 4 per cent to 162,500 last year from 169,000 in 2000. In England, the number of new homes built has fallen by 5 per cent for the last four years.

The Halifax says if housebuilding in England continues at last year&#39s level, there will be a shortfall of over 400,000 homes to cater for the additional three million households projected by the Government between now and 2021.

The situation is worse in the South-east, where there is an estimated deficit of more than 450,000 homes if housebuilding remains at 2001 levels.

New properties represent only 11 per cent of properties sold, with only 7 per cent in London compared with 30 per cent for new properties in Northern Ireland.

Halifax Estate Agents economist Martin Ellis says: “Des-pite the obvious popularity of new homes, there has been a clear shortage of new properties available on the market over the past year, which has undoubtedly contributed to the recent rapid rise in house prices.

“The rate of housebuilding must increase significantly from last year&#39s record low in order to meet the requirement for extra homes over the coming years.”

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