DELIVERY OF HOUSEBUILDING TARGETS WILL NOT BE STRAIGHTFORWARD

Amongst the considerable legislative programme which will be announced in today’s King’s Speech will be a commitment by the new government to build 1.5 million new homes in the next five years - a pledge backed by compulsory housebuilding targets, extra resources to enable the recruitment of hundreds of new planning officers, and a loosening of planning restrictions, writes Harry Downing.

Chancellor Rachel Reeves sees speeding up the delivery of new housing as a key plank in her focus on economic growth, and regards current planning restrictions as a barrier to achieving that ambition.  She has also made it clear that she sees solving the housing shortage – including a chronic deficit in affordable homes – as a social imperative, and has promised an ‘interventionist approach’ to making it happen.

Encouragingly, there has been a recognition that to succeed in this plan, there will need to be a focus on infrastructure projects alongside the drive to build more new homes.

There are currently two main barriers to the delivery of sufficient new housing in the UK.  The first, as Rachel Reeves has rightly identified, is our slow-moving and obstructive planning system.  But that is not the only problem.  Demand for new homes in the market needs be stimulated if developers are to be able to deliver them profitably.

That will require further cuts in interest rates to drive affordability for buyers, but it will also need the new government to deliver on its promise to prioritise economic growth.  It’s a bit of a chicken-and-egg situation: we need economic growth to be able to build new homes, but we need to be building new homes in order to drive economic growth.

As for planning reform, we should welcome this in principle, but as ever the devil will be in the detail.  Reforming the National Planning Policy Framework, helping cash-strapped local authorities create more capacity in their planning departments, and helping developers negotiate issues such as Nutrient Neutrality and Biodiversity Net Gain are all significant challenges, not to mention overcoming the inevitable resistance to development which is strategically important nationally but which may not be so welcome locally.

This is not the first time an incoming government has made big promises on housebuilding.  In 2019 the Conservatives made exactly the same pledge (300,000 new homes a year and mandatory housing targets), only for the commitment to be watered down and then abandoned altogether in 2023.

We have to hope that Keir Starmer’s administration, emboldened by a huge majority, has the courage to stick by its own commitment to building new homes, and that it manages to deliver the economic growth which is a prerequisite for those targets to be achieved.