David Fell, lead analyst at Hamptons, said: “Housebuilders haven’t been immune from the impact of higher mortgage rates or the ending of the Help to Buy scheme.
“On current rates, there are likely to be around one million homes built this Parliament, a similar figure to the previous one.
“While interest rates are heading in the right direction from the perspective of would-be buyers, it’s likely to take a reincarnation of Help to Buy to get numbers back up above recent averages.
“Successive governments have looked to drive up homeownership rates, typically at the expense of freezing many investors out of the market.
“But traditionally, investors have been some housebuilders’ best customers, often buying homes two or three years before they’re built.
“With early sales secured, developers have had the confidence to buy more land and speed up construction on-site.
“Without big backing from investors, housebuilders have typically waited until homes are much closer to being built before marketing them.
“As a result, construction rates have slowed down, and housebuilders have more cash tied up in each site for longer.
“It’s likely to take every part of the market firing on all cylinders to get the government close to its 1.5 million home target.”
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