In light of this weeks Office for National Statistics figures showing solid end-of-year growth in construction output across all sectors apart from private housing, (which fell by 0.4%) it’s worth exploring some of the issues still plaguing housing delivery.
Key Challenges to Delivery
It’s no secret: pressure on new housing delivery continues, and meeting demand is an ongoing challenge for developers, Housing Associations, and Local Authorities. Industry reports consistently show the same concerns: land availability (affected by, among other things, planning policy and market forces), followed by skills/organisational capacity, and a lack of grant funding.
What’s the problem?
Large-scale housing development seems an obvious way to deliver more homes quickly, so what is happening and why are we hearing about ‘slow housing delivery’? This is obviously a complicated issue, but let’s briefly explore three facets of the ‘land availability’ issue.
While being the single biggest factor inhibiting delivery, ‘land shortage’ seems like a misnomer. According to the NHF, there are 18,000 brownfield sites across England (with the greatest number in the South East). These have a combined development potential of a million net additional homes, and 12% of sites are in public ownership.
Planning policy clearly also affects land use. That said, between 2011/12 and 2017/18, on average, 258,192 homes were consented each year but only 153,560 homes were completed each year.
This gap between consent and delivery is a challenge and we often focus on the planning system (which restricts and permits development, but does not demand its completion). However, the gap may not be as significant as it seems as achieving post-consent approval of details (including reserved matters) can take significant time.
Lichfields’ research (first reported in 2016 and updated in 2018) found that sites of all sizes experience the same constraints, and “Planning for housing involves more than just allocating sites in local plans and granting planning permission for development to take place”. They found that sites of 500-999 units struggle to complete more than 100 homes a year. Possible reasons include market forces - unless prices drop, the market can only absorb so many of a limited range of products in any period.
In Conclusion: Possible Solutions
There’s no single solution to speeding up delivery, and bodies such as Local Authorities have limited control over development once it has been fully permitted, despite becoming increasingly accountable under the NPPF for delivery against their local housing requirements.
Proposed ‘reforms’ include;
- Local Authorities may look to impose ‘milestones’ with deadlines e.g. numbers of storeys or residential units
- Local Authorities may look to directly engage in delivery, either individually or with private sector partners, or to set up ‘Local Housing Companies’, independent arms-length commercial developers wholly or partly owned by councils
- Improved coordination between utilities, highways authorities and other agencies to help bring forward build starts
- Better-resourced local authority planning departments, who make full use of Local Plans and Planning Performance Agreements.
Encouragingly, surveys show partnerships have been active in the sector. Well delivered partnerships spread risk, unlock opportunity and accelerate delivery.
Modern methods of construction also represent a big opportunity to streamline development and are attracting significant investment - read more about this is in Kerry-Ann O’Neill’s article here.
Planning for housing involves more than just allocating sites in local plans and granting planning permission for development to take place.