Housing supply at risk under proposed planning changes

Up to 77,000 fewer new homes are likely to be built a year for the rest of this decade, slumping to the lowest level since the second world war, according to a new report.

Lichfields’ Making a Bad Situation Worse, calculates by 2030 more than a million fewer homes will have been built than anticipated with annual output dropping to 120,000 a year. This would leave the government’s 300,000 new homes a year housebuilding target in tatters.

Homebuilders Federation, HBF, executive chairman Stewart Baseley said: “The increasingly anti-development and anti-business policy environment poses a real threat to house building and is inevitably at the forefront of minds when investment decisions are being made.”

Proposed changes to England’s planning framework will mean local planning authorities won’t need to have a five-year housing land supply and produce housing delivery tests. The expectation councils should release some green belt land to ease housing shortages will also be dropped.

An estimated 47 local authorities have already retracted or delayed their local plans as a result with only 39 with an up-to-date plan.

The National Federation of Builders, NFB, housing and policy head Rico Wojtulewicz said: “The cost of development has already seen smaller builders either leave the industry or pull away from housebuilding.”

He said that in the last two years, the government had added 13 new costs for housebuilders leaving the future of housing supply at risk.

New housing isn’t responsible for river pollution

Alongside this, Natural England’s increasing intervention over nutrient neutrality of rivers has halted 120,000 new homes being built with a further supply cut of up to 41,000 homes a year.

The fact that intensive farming, rather than increased showering and washing, is the main cause of nitrate and phosphate pollution has infuriated the building industry.

The HBF said that water companies’ long-term failure to upgrade wastewater treatment facilities is another culprit. It estimates the building industry has paid £3bn in infrastructure charges to water companies over the last 30 years.

“The government’s mishandling of water and drainage legislation could see fewer homes built than ever before. The social and economic implications are stark and threaten to widen the ever-growing intergenerational divide while costing hundreds of thousands of jobs,” said Mr Baseley.

Consultation on changes to the national planning policy framework will finish by the end of this week with the government expected to bring forward draft legislation by spring.

Land Promoters and Developers Federation, LPDF, executive chairman Paul Brocklehurst said: “The government still has sufficient time through the consultation process to reconsider its position and move away from changes which in the context of its 300,000 aspiration are frankly irrational. Now is the time to deliver meaningful, positive reforms which will embed growth into our economy.”

The report, commissioned by the HBF and LPDF, predicts the estimated housing supply cuts will mean 386,000 fewer jobs with a £34bn GVA, gross value added, loss to the economy.

Brokers Hank Zarish Associates said commercial development finance lenders were concerned the rising costs of future homes would mean even more people would be priced out of the market.