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01 March, 2012

Planning Permissions Drought Worsens

New stats reveal housing permissions have halved in 4 years

“This is a stark reminder as to why Government must stand firm and deliver a robust and pro-growth planning system”.

The report, compiled for HBF by Glenigan reveals;

  • Total 2011 permissions granted in England lowest since survey started in 2006
  • Just 115k permissions granted in 2011, half the 2006 level and half the number required
  • In Q4 2011 approval was granted for just 27,732 units in England – 6% down on Q3 2010
  • Just 16,334 social units approved in 2011, down 47% on 2010 and 52% on 2006
  • Quarterly average in 2011 was 28,853 compared to 33,535 in 2010 and 53,116 in 2006 

Figures released today in HBF’s latest Housing Pipeline report reveal that approvals for just 27,732 homes across England were granted in Q4 of last year, a fall on Q3 and on the same period a year earlier. It means that the total number of permissions granted in 2011 was the lowest since HBF started the survey in 2007, with permissions running at half the level of four years ago and half that required to build the homes needed to meet demand.

The figures are a huge wakeup call and forcibly demonstrate why Government must stand firm and deliver a pro growth National Planning Policy Framework and resist the vocal anti development lobby’s scaremongering 

If the new planning system is not pro-growth other positive measures – for example the NewBuy mortgage indemnity scheme, Get Britain Building, release of public land – cannot succeed in boosting housing supply.

Planning permissions granted now will, in the main, be built during the next three or four years. At a time when fewer homes are being built in England than at any time since the 1920s, the figures reveal the potential for intensifying the country’s housing crisis.

The social effects of continuing to undersupply homes are obvious: five million people languish on local authority waiting lists, millions more live in over-crowded and substandard accommodation, whilst first-time buyers have all but disappeared – further stagnating the housing market. An additional 140,000 homes a year are needed to meet demand. Delivering these could create half a million jobs and boost the economy both locally and nationally.

Speaking today, Stewart Baseley, Executive Chairman of the HBF, said; 

“This is a stark reminder as to why Government must stand firm and deliver a robust and adequate planning system.  

“Government has recently unveiled some very positive measures aimed at boosting housing supply, particularly the NewBuy scheme, but they cannot succeed unless we have a truly pro-growth functioning planning system. 

“The new system must provide enough viable land to build the number of homes the country needs. Continuing the current record low level of house-building is storing up huge social and economic problems for the years ahead and the shortfall must be addressed.

“Building the homes we need would take millions off social housing waiting lists and enable beleaguered first time buyers to get a foot on the ladder. It could also create half a million new jobs, and give the country a huge economic boost.”

Allan Wilén, Glenigan’s Economics Director, commented, “The number of new homes securing planning approval hit a new low last year, falling below the previous low point set in 2009 during the depths of the recession. The near halving in social housing units securing approval was especially stark and combined with the continued weakness of private housing approvals leaves the overall number new homes at 132,000. This is half the level of annual approvals seen during 2006 and 2007 prior to the recession.” 

The Government is currently considering responses to its consultation on the NPPF that will provide the nuts and bolts of its new planning system. Its draft proposal empowers local people, businesses and charities to shape growth in their communities. It strikes a balance between economic growth, a presumption in favour of sustainable development and existing environmental protection.

For media enquiries, or to arrange an interview, please contact Tim Collins on 020 7960 1612 / tim.collins@hbf.co.uk  

Notes to editors

  1. The Home Builders Federation (HBF) is the representative body of the home building industry in England and Wales. The HBF’s member firms account for some 80% of all new homes built in England and Wales in any one year, and include companies of all sizes, ranging from multi-national, household names through regionally based businesses to small local companies: www.hbf.co.uk 
  2. With over 30 years experience, Glenigan is the genuine market leading provider of UK construction and civil engineering project, company and market information.
    Part of the Insight Division of Emap Limited, one of the UK’s largest media businesses providing must-have information, magazines and events, Glenigan users enjoy small business intimacy combined with business security.
  3. The Housing Pipeline report for Q1 2012 will be published in May.
  4. Housing need figures based on DCLG Household Formation Projections. The number of households is projected to grow from 21.7m in 2008 to 27.5m in 2033, a rise of 5.8m (27%), or 232,000 per year. The latest projections have reduced household growth by approximately 20,000 per year  compared with the previous, 2006-based projections.
    http://www.communities.gov.uk/documents/statistics/pdf/1780763.pdf 

Useful stats

  • The number of households is projected to grow from 21.7m in 2008 to 27.5m in 2033, a rise of 5.8m (27%), or 232,000 per year. (DCLG Household Formation Projections.)
  • According to Government figures, even in its current crisis state, housing supply accounts for around 3% of UK GDP and provides between 1 and 1.25 million jobs in the UK.
  • Jobs Calculator:
    • Each home built creates 1.5 full-time jobs -Michael Ball report
    • Increasing house-building by 130,000 units per year (to Government household projection levels) would create 195,000 jobs.
    • HBF estimates twice that number of jobs are created in the supply chain – close to 400,000 jobs.
  • HBF’s  Housing Market Report (May’11) shows that 91% of house builders now see the lack of mortgage availability as a ‘major constraint;’ on their ability to sell, and thus build, homes
  • Over the last three years, home builders have invested almost £1billion in shared equity schemes to help maintain housing construction whilst helping close to 30,000 first time buyers get a foot on the ladder
  • The number of new homes completed in England in 2010 slumped 13% on the previous year to 103,000 – itself the lowest peacetime number on record since 1923
  • 1.8 million families (5 million people) are currently on Local Authority waiting lists in England
  • 18% of females and 29% males aged 20-34 still live with parents – ONS social trends Or; Over 1 million women and 1.7 million men aged between 20 and 34 are still living at home
  • FTBs aged between 22 and 29 have to save 45% of their take home pay every month for five years to afford a deposit
  • Whilst over 80% of people believe Britain needs more homes, particularly for first time buyers, only 50% of people would welcome more homes in their area - NHMB survey, Nov 2010.