Collapse in planning permissions exacerbates already acute housing shortage

The latest HBF Housing Pipeline report reveals social housing was hardest hit with only 5,500 approvals – a new low for the survey and particularly concerning with 5 million people already languishing on Local Authority housing waiting lists.

HBF released the report just days after Government published its 2010 housing statistics that showed  the number of new homes completed in England in 2010 slumped 13% on the previous year – itself the lowest peacetime number on record since 1923.

The implications of the collapse in permissions are stark and exacerbate an already acute housing crisis. Currently the country has a housing shortfall estimated to be a million homes, with people being forced to stay with their parents for longer and first time buyer levels at an all time low.

Permissions granted for homes typically take up to three years to build. So the full implications of this drop will not be felt for some time. However, with household formation projections showing the need for England to build around 232,000 homes a year until 2033, and 2010’s total at just 103,000 – there is obvious potential for the crisis to deepen.

The report also shows that through 2010 there was a steady fall in permissions granted to developers for new homes in England, with a drop from over 40,000 in Q1 to under 30,000 in Q4. This drop coincides with the Coalition Government having set out a radical agenda for planning change. The downward trend in permissions shows the importance of the Government implementing its proposals for a pro-growth planning system as soon as possible.

Speaking today, HBF Executive Chairman Stewart Baseley said.

"These figures are extremely concerning. A reduction in permissions granted now will see fewer homes built in future years, exacerbating the already acute housing shortage we are currently experiencing.

"The figures demonstrate the necessity for the Government to clarify exactly how the new Localism based planning system will deliver the homes, and supply the growth we desperately need. Only by ending the ongoing hiatus caused by the scrapping of the old system without a ready replacement can developers and Local Authorities plan ahead confidently and effectively for new housing.

"It is also crucial that Councils recognise the housing shortage and accept their new responsibility for housing supply. This will require understanding the new system, taking full account of the Government’s incentives and allowing developers to build the homes local residents and the country desperately need.” 

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