A comprehensive new house building programme is needed if the UK is to see the 300,000 new homes a year that has been promised by the Government.
The pledge, made by the Chancellor Philip Hammond in his Budget, will be hard to meet unless the planning system is reformed with change needed quickly, according to experts, with new figures showing that construction award figures have fallen.
Hammond said in his Budget speech that there is no quick fix to boost the housing market and acknowledged that planning needs to be reformed to allow for more homes to be built and part of this process also involves freeing up more land for builders as well as stopping developers from holding onto land that already has permission.
As part of the process he announced a review panel, to be chaired by MP Oliver Letwin, into the significant gap between housing completions and the number of homes actually being built. He revealed that in London alone there are 270,000 residential planning permissions unbuilt.
The review will give recommendations on how to close the gap provide an interim report in time for the Spring Budget in March 2018 and a full report for the main Budget in the Autumn.
Hammond also announced the creation of a central register of planning permissions with data from local authorities across the country to improve information on where permissions are held and progress towards them being built out.
There is some concern that this will not move fast enough to boost the supply of homes for sale which is keeping house price growth high. According to Lewis Johnston, parliamentary and public affairs manager at the Royal Institute of Chartered Surveyors (RICS) the Government needs to be more proactive.
‘If the Chancellor really wants to increase supply to a degree that will transform UK housing, he should implement a comprehensive house building programme, incorporating direct commissioning by central and local Government,’ he said.
‘There should also be a more fundamental review of the planning system than was announced, including a policy of green belt swaps so that appropriate sites on the urban edge can be considered for housing supply,’ he added.
Nicky Gavron, chair of the London Assembly’ planning committee, pointed out that the 270,000 planning permissions not acted upon in the city is equivalent to almost five years of supply and said the LA has already done the research and has a package of measures to unblock supply.
‘What we want is action, which is why we urge the Government to intervene in whatever way necessary to ensure this land is used for housing,’ Gavron added.
John Elliott, managing director of Millwood Designer Homes, pointed out that not all builders hold onto land but there are systems that hold up the start of the construction work which need to be addressed.
‘We aim to build as soon as possible once planning permission has been granted. What is time consuming is clearing the myriad of conditions that come with the consent and utilities companies sometimes taking months before they start work,’ he said.
The latest construction figures also suggest that more needs to be done to speed up the system in terms of awarding contract to builders. Between June and August 2017 more than £7 billion of housing contracts were awarded but since then they have fallen by 10% in September and October, according to the latest economic and construction market review from industry analysts Barbour ABI.
The report says that more bigger project contracts were awarded in October rather than a succession of smaller contracts.