Major mortgage lenders have also raised their forecasts for annual house price increases to 24% over the year.
The number of private homes started in the first eight months of 2002 was 113,100 compared with 112,100 in 2001, an increase of 0.9%.
A spokesperson for the House Builders Federation said the total number of housing completions last year was at its lowest peacetime level since 1924.
He said completions last year stood at 162,000, compared with household growth of 220,000. "That one of the world's wealthiest nations does not have sufficient homes to house its population is nothing short of a disgrace," he said.
He added that although the government had promised to tackle the problem, the figures showed that little had been done to ensure local planning authorities allowed sufficient homes to be built.