The drop came as the supply of new build homes, conversions and buildings changing use slowed further, only partially offset by other types of homes, such as temporary dwellings or mobile homes, coming through, according to the Department for Communities and Local Government (CLG).
However, the rate of decline in net supply has slowed markedly by comparison to the drop off of 23% seen during the height of the financial crisis between 2008-09 and 2009-10.
Nevertheless, at the height of the market, housing supply was far closer to the 250,000 new homes said to be needed to meet demand, peaking at 207,370 net homes in 2007-08 after six years of growth.
In 2010-11, the CLG figures showed the supply of new builds fell 5% to 117,700, converted homes dropped 19% to 5,050, and new homes resulting from a change of use fell 15% to 11,540.
By comparison, the supply of other types of homes rose almost 87%. However, this was from a low base of 970 in 2009-10 to 1,810 in 2010-11.
Meanwhile, 14,890 homes were lost through demolition during 2010-11, but this was down 9% from 16,330 the previous year.
London has seen the largest drop in the past year, down 27% to 17,830 additional homes, followed by the North West, with a drop of 16%. By comparison, the North East saw a 26% increase in supply to 4,710, while the East of England saw a 5% increase.
Steve Turner, head of communications at the Home Builders Federation, said: “It is clear there are significant constraints on housing supply at the moment, which does not reflect demand. There is a lack of mortgage availability preventing people from buying and long-term constraints on land supply.
“The government must implement a robust planning system as soon as possible, aseffectively we have not had one since the general election.
“We need to see an increase in supply in order to avoid significant social and economic implications.”
