According to the Royal Institution of Charter Surveyors (Rics) the Government needs to build in excess of 200,000 new homes each year in order to reach their target of 2m homes by 2016.  However, so far this year only 66,220 new homes have been built with a fall below 25,000 per quarter likely by the end of the year. 

Overall, the body said that UK construction workloads fell at their fastest rate for at least 14 years during the third quarter of this year.

Today’s UK Construction Market Survey, shows the proportion of surveyors reporting a decline rather than a rise in activity rose to 38% in the third quarter, from 19% in the previous three-month period. This is the weakest level since the RICS began its quarterly construction market survey in 1994.

RICS senior economist Oliver Gilmartin said: "With finance for projects becoming increasingly difficult to obtain, the Government's ambitious target of 2 million new houses a year by 2016 is likely to fall well short. At current levels of production the number of new homes built will fall below 100,000 in the coming year."

He added: "The outlook for the construction industry is extremely bleak with the previously strong infrastructure sector now unlikely to step in as the downturn in property markets resonates. A rapid solution to the log jam in credit markets is necessary to limit the severity of the current downturn which is starting to affect the country's infrastructure"