New home registrations in London have dropped by 38%, making the capital the only UK region to see a significant decline in housing starts. According to warranty provider NHBC, the fall is largely due to delays caused by the new building safety regime, with developers struggling to navigate the Gateway 2 approval process under the Building Safety Regulator.
While the rest of the UK experienced strong growth in Q1 2025, London’s downturn dragged national apartment registrations down 3% year-on-year, reflecting weakened confidence in the capital’s high-rise sector.
Across the UK, 29,356 new homes were registered in Q1 — a 36% increase compared to the same period last year. NHBC attributes the rise to easing inflation, improved mortgage rates, and government commitments to planning reform and infrastructure investment.
Private housebuilders led the surge, with a 62% increase in registrations, particularly for low-rise developments. Starts on detached homes rose by 63%, and bungalow registrations climbed 54%, indicating a shift in focus away from apartment building.
NHBC Chief Executive Steve Wood commented:
“Although global uncertainties remain, the combination of falling inflation, more accessible mortgage deals, and strong spring sales suggests positive momentum for UK housebuilding — particularly in low-rise sectors and outside of London, where new safety regulations have had less impact.”
In London, housing association activity also declined, with many diverting budgets towards maintaining and upgrading existing stock instead of launching new developments.
Despite London’s struggles, UK-wide housing completions remained steady at 26,120 — just 1% below last year’s figure. NHBC expects rising confidence to translate into greater housing supply in the months ahead.
Meanwhile, new research from the G15 group of major London housing associations paints a stark picture: the number of new affordable homes started has plummeted 66% over the past two years, falling from 13,744 in 2022–23 to just 4,708 in 2024–25.
The G15 is calling for urgent action, including full access to the Building Safety Fund for housing associations — bringing parity with private landlords — and a 10-year rent settlement to support long-term planning and investment amid London’s deepening housing crisis.
