Government 'must do more on affordable housing'

It is still a challenging environment for builders

The government needs to act now to make sure enough affordable homes are being built, campaign groups have said, after figures showed the number of housing starts in England fell 11% in 2012.

Housing charity Shelter said the government faced a "housing crisis" unless immediate action was taken.

The National Housing Federation also said more needed to be done to meet the huge demand for affordable homes.

A spokesperson for the government said ministers were "far from complacent".

The Home Builders Federation said it was "still a challenging environment" in which to build homes.

"A lack of mortgage finance is the most important short-term issue and if buyers can't buy, builders can't build.

"But we have seen a much more positive start to the new year with an easing in lending and schemes like the government's NewBuy enabling people to get a 95% mortgage," the group said.

'Unlock finances'

Latest figures from the Department for Communities and Local Government (DCLG) showed the number of new builds started in England fell to 98,280 in 2012.

The number of housing starts peaked at 183,000 in the year ending March 2006, but fell sharply in the downturn to a low of 75,000 in the year ending June 2009.

Since then starts have recovered somewhat to about 110,000 per year, but DCLG said recent quarters had seen them slip back again.

However, the most recent quarter, ending in December, saw a 1% rise compared with the previous three months.

David Orr, chief executive of the National Housing Federation, said: "Despite the current tough economic environment, the small signs of increased house building are encouraging - but more needs to be done across the whole sector to meet the huge need for more affordable homes.

"We expect housing associations, who are dealing with a radically new investment framework and a huge cut in funding for affordable housing, to continue finding innovative new ways to meet that demand."

Campbell Robb, chief executive of Shelter, urged the government to use next month's Budget to unlock the finance to deliver more affordable family homes.

"Unless action is taken now, it's hard to see our housing crisis improving any time soon," he said.

A DCLG spokesman said the latest figures showed "steady improvement" compared with the previous quarter.

He said: "The government is far from complacent, which is why, despite the need to tackle the deficit, we're investing £19.5bn public and private funding in an affordable housing programme set to deliver 170,000 homes, putting £1.3bn into unlocking stalled sites and building the infrastructure we need and making enough formerly used, surplus public sector land available to deliver 33,000 new homes."