Housing starts fell by 14 per cent between April and June this year, with starts dipping across all tenures.
Private housing starts fell by 12 per cent compared with Q1 2015, while housing association starts declined by 23 per cent over the same period.
Local authority starts almost halved compared with the previous quarter, falling from 650 in Q1 to 360 in Q2.
Private housing starts for Q2 now stand at 28,110, down from 31,930 in the previous quarter.
Overall, there were 33,280 housing starts in Q2, more than 5,000 fewer than the 38,860 recorded in Q1 2015.
KPMG head of housing Jan Crosby described the 14 per cent decline as “worrying”.
She added: “While the £10m set aside in the recent government Starter Homes announcement to prepare brownfield sites for build can only be welcomed, had that money been instead put towards funding additional planning officers it would have a much bigger impact.
“And that’s the key: in a climate where funding continues to be tight, every penny must be spent in the most effective way, which is why the housing sector and public must continue to call for a long-term strategy.”
Nevertheless, housing starts still remain well ahead of the pre-recession trough recorded in early 2009.
In total, 136,320 homes were started in the 12 months to June 2015, down 1 per cent compared with the 12 months to June 2014.
This level remains 26 per cent below the peak recorded in the 12 months to December 2007.
Housing completions saw a slight upturn in the Q2 2015, rising by 4 per cent compared with Q1.
In total, Q2 saw 35,640 housing completions – 1,480 more than the previous quarter and the highest level recorded since early 2009.
Housing associations led the charge, posting a 6 per cent upturn in completions, while private housing completions rose by 4 per cent.
Overall, housing completions for the 12 months to June are 15 per cent higher than the same period a year earlier, but much like housing starts, completions still lag behind the pre-recession peak recorded in the 12 months to December 2007 by 26 per cent.