New homes built in South East England increased by 12% to 31,900 in 2004-2005 compared to the previous year (28,400), according to initial results of last year’s housing completions published by the South East England Regional Assembly.

This is the second year running that housing completions have exceeded the Regional Planning Guidance target for the South East of 28,000. The average build rate over the past five years was 26,700 homes.

Housing Corporation investment has been one of the factors behind this performance, argued the Regional Assembly report.

Cllr Keith Mitchell, chairman of the Assembly said: "These figures disprove the charge that South East local authorities are holding back the supply of new homes. They show that the region can respond to growth pressures when the conditions are right and the public investment is forthcoming."

"If the government wants this level of growth to continue Ministers need to commit to stepping up investment in affordable homes and infrastructure."

Although the figures show progress towards meeting the high levels of demand for housing, they also highlighted some challenges for the South East.

Most housing has been built in urban areas, however if this continues it will put more pressure on local services. To maintain this level of growth, local authorities will need increased revenue support from central government.

Affordable housing is a key aspect of sustainable development and requires public sector investment as well as leverage on private sector developers.