UK Construction Confident but Supply Shortage Looms
Rocketing demand for new homes mean builders have been working at a much faster rateReuters

The surge in UK house prices could start to slow as home builders are set to construct new properties at the fastest pace since 2007.

National House Building Council (NHBC) data shows that there were 36,343 new home registrations between July and September, meaning construction firms are preparing for a glut of new builds.

"Our figures show that the sharp housing upturn we have seen over the last couple of years is a genuine broad-based recovery across the whole of the country, with pockets of strong growth in the North East, Yorkshire and Humberside and West Midlands," said Mike Quinton, CEO at the NHBC.

"It is now increasingly apparent that housing growth is no longer London and South East-centric, with these regions beginning to show signs of cooling.

The lack of UK housing has been largely to blame for rocketing properties prices due to the significant gap between supply and demand.

According to the Confederation of British Industry (CBI), 240,000 new homes need to be built per year to sate current levels of demand but over 200,000 homes have been delivered in only four out of the last 14 years.

In 2010, fewer houses were built than in any year since the Second World War.

The chronic shortage of supply and increasing demand has meant house prices, on average, have rocketed by 56% nationally since 2004, with a 90% increase in London.

Lloyds Banking Group also warned that around 60,000 new houses need to be built annually to remotely keep up with demand.

The average UK house price in August 2014 was £274,000 (€345,052, $437,283), according to the Office for National Statistics.

This equates to the average property price of £285,000 in England, £172,000 in Wales, £143,000 in Northern Ireland and £200,000 in Scotland.