The number of new housing starts soared 10% year-on-year in the three months to the end of September, according to figures released the day after billions of pounds more government funding was announced in support of efforts to end the housing crisis.

There were 38,730 starts in England during the quarter, shows data from the Department for Communities and Local Government (DCLG). Completions hit 37,280, up 7% on the same quarter a year before. For the year to the end of September there were 147,880 starts and 141,690 completions, both figures up annually by 4%.

Though rising, housebuilding activity is still well below what is estimated to meet demand, which varies from 200,000 to 300,000 new units a year. The housing shortage has driven up house prices and rents in recent years, particularly in London and the south-east, where the supply problem is most acute.

Chancellor Philip Hammond unveiled in his Autumn Statement extra funds for housebuilding to deliver at least 140,000 new housing starts by 2020, 40,000 of them "affordable".

A new Housing Infrastructure Fund will spend £2.3bn by 2020-21 and "will provide infrastructure targeted at unlocking new private house building in the areas where housing need is greatest," according to the Autumn Statement document. And there is an extra £1.4bn being made available for the construction of "a mix of homes for affordable rent and low cost ownership".

"This commitment to housing delivery represents a step-change in our ambition to increase the supply of homes for sale and for rent, to deliver a housing market that works for everyone," Hammond said in his Autumn Statement speech.

It follows a previous announcement by the government of £5bn funding to boost lacklustre housebuilding figures. Of this, an extra £2bn of funding will be made available to bring public land with planning permission up to scratch for the construction of new homes.

A further £3bn of previously announced funding would be directed into a Home Builders Fund. Of this, £1bn will be short-term finance made available to smaller builders for 25,500 new homes by 2020. And £2bn from the government's infrastructure spending will be used over a longer period of time to deliver 200,000 more homes. Moreover, new changes to planning laws will make it easier to secure planning permission for new housing on brownfield sites.

But the shadow housing minister, John Healey, accused the government of doing "too little and too late" to tackle the housing crisis. "Six years of Conservative housing policy have led to the lowest level of new affordable housebuilding in 24 years," he said.

"Today's announcement is too little and too late. Too little to make good the huge cuts in housing investment from 2010, with investment still only half the level left by Labour.

"The government have no long term plan to fix the housing crisis and if they're serious about trying they should back Labour's plans to build tens of thousands more affordable homes to rent and buy each year."