Planning approvals hit record low

The latest Housing Pipeline Report from the Home Builders Federation (HBF) showed a continued downward trend in planning approval figures in both the number of sites and units approved for development.

The report, which contains data from Glenigan, revealed 2,260 sites were approved in the months of July to September.

This is a 10 per cent decline from the previous quarter and the lowest quarterly total recorded since HBF reporting began in 2006. 

The rolling annual total of 10,180 sites approved is also at a record low, which HBF said illustrates the challenges the UK housing sector faces in meeting growing demand.

While the number of units approved during Q3 increased by two per cent to 57,356, it is 40 per cent below the peak.

The rolling annual total of 240,661 units saw a one per cent rise from Q2 2024 but remains six per cent lower than the same period in 2023.

In the months following the general election, Labour has stood firm on their promise to deliver 1.5 million homes over the next five years.

Last year, Labour unveiled new mandatory housing targets, which would rise to 370,000 a year from 300,000 for all councils in England.

Neil Jefferson, chief executive of the HBF, said: “The continued decline in planning approvals is deeply concerning and underlines the scale of the challenge we face in addressing the country’s housing crisis.

“The recent efforts by the Government to reform planning policy are very welcome, but the data makes it clear that much more needs to be done to reignite housing delivery.”

According to HBF, to meet the Government’s target of 370,000 new homes annually, approvals need to increase by more than 150 per cent.

The latest housing supply statistics, published by the Ministry for Housing, showed housing supply in England totalled 221,070 net additional dwellings in 2023-24, a 6.5 per cent decrease on 2022-23.

Regionally, the decline in planning approvals has been most significant in the North East (61 per cent), Yorkshire & the Humber (49 per cent), and the West Midlands (55 per cent). 

Despite London seeing slight increases, the numbers remain far below historic levels.

HBF claimed the regional disparities further complicate efforts to address the national housing crisis, with areas in greatest need of new homes facing the most significant barriers to development.

Jefferson added: “We are seeing significant regional variation, with some areas experiencing severe drops in approvals, while others, like London, are still well below previous levels. This discrepancy highlights the need for targeted interventions that not only speed up planning processes but also provide clear support for both developers and homebuyers.

“The lack of affordable housing is impacting communities across the country, and without a stable demand for new homes, the industry lacks the confidence to invest in building the homes that are desperately needed.

“Increasing housing will require going beyond planning reform and addressing broader issues such as financing for homebuyers and a lack of providers in the market to take on the affordable housing developers build.

“Continued intervention from the Government will be crucial to ensuring we have a robust housing market that can deliver for the nation and tackle the housing crisis head-on.”

In the Autumn Budget, Chancellor Rachel Reeves announced an additional £3 billion in housing guarantees aimed at supporting SME housebuilders and the Build-to-Rent sector, and deliver more than 20,000 new homes.

On top of that, Reeves pledged to increase the housing supply investment to £5 billion, with £500 million injected into the current affordable homes programme, increasing it to £3.1 billion.

Was this interesting? Try: Suir Engineering acquires 114-year-old M&E firm

If you have a tip or story idea that fits with our publication, please contact the news reporter/editor