The Home Builders Federation (HBF) has issued a stark warning, predicting a significant drop in housing supply in the coming year. According to HBF’s executive chairman, Stewart Baseley, the forecasted decline could see housing availability plummet to under 200,000 homes by 2024, marking the lowest figure since 2014.
Recent data compiled by the HBF reveals a concerning trend in planning permissions for new homes across England. The number of permissions granted has reached an unprecedented low, sounding alarms within the housing development sector. The third quarter of this year witnessed a striking 12% decrease in new home permissions, resulting in only 50,316 housing units approved between July and September 2023. This represents the lowest quarterly figure reported since the inception of the HBF’s Housing Pipeline Report in 2006.
Over the past year, the decline in planning permissions has been persistent, plummeting by 28% compared to the corresponding period in the previous year. Data sourced from Glenigan highlights a concerning statistic: a notable 20% drop in projects granted planning permission in the year leading up to September, with only 2,447 projects greenlit compared to the same period in the prior year. Notably, 91% of approved projects in the third quarter were housing schemes comprising ten or more units.
The cumulative impact of these dwindling permissions has been profound, with the overall number of units gaining permission in the year to September 2023 reaching a strikingly low 245,872. This marks a 15% decrease from the previous year and represents the lowest yearly figure recorded since 2015, exacerbating concerns about the impending housing crisis.
Stewart Baseley, expressing grave concern over this trend, attributed the decline in permissions to “several years of anti-growth policy.” He criticized the prioritization of politics over addressing the worsening housing crisis. Baseley cautioned that proposed changes aiming to remove planning system targets and consequences could lead to a stark reduction in new homes. He further emphasized that such measures risk undermining investments in jobs and communities.
The latest half-yearly results from Homes England corroborate this worrying trend, with a notable decrease in new house starts and completions. Between April 1st and September 30th, 2023, Homes England reported a 22% decline in new house starts (11,530) and a 6% decrease in completions (11,297) compared to the same period in 2022.
The cumulative effect of diminishing planning permissions and declining housing starts and completions paints a dire picture for the future of housing supply in England. Concerns persist that without strategic intervention, the nation could face an exacerbation of the housing crisis, affecting communities and livelihoods across the country.