Figures released in HBF/Glenigan’s latest Housing Pipeline report show the moving annual total number of permissions being granted is now at 194,820 – well above the 120/130,000 levels of 2009.
But whilst the overall level of permissions now being granted remains at the highest level since 2008, a levelling off demonstrates the need for government to continue to monitor and seek further improvements to the planning system to ensure sites are brought through the system and into production more quickly.
Speeding up the rate at which permissions are granted is one of the keys to a significant, sustainable increase in housing supply. Too many sites are ‘stuck’ in the planning system, with an estimated 150,000 plots at ‘outline permission’ stage awaiting full sign off by local authorities. Local authorities must ensure their planning departments are adequately resourced so that applications can be processed efficiently and speedily and house builders can start work on new sites as soon as possible.
Since its introduction in 2012, the National Planning Policy Framework (NPPF) has helped ensure an increase in the number of local plans coming forward with allocations of land to meet housing needs. 60% of local authorities now have an adopted plan in place. Where local authorities fail to meet their housing needs or keep plans up to date the NPPF provides a route for the Secretary of State to step in and take decisions on applications. This clear and simple process has delivered ever increasing numbers of permissions since its publication in 2012.
As demand for new homes continues to increase – recently largely as a result of the Help to Buy Equity Loan scheme – Government must keep up the pressure on local authorities, and continue to apply and review the NPPF to ensure the new higher level of demand is met with a commensurate increase in supply.
Figures in the latest report show a slight drop in the number of permissions for new homes granted in Q3 of this year, compared to Q3 2013: 41,746 permissions were granted in England, down from 44,251 in 2013. The majority of the fall has been in the affordable housing sector with just 3,908 dwelling permissions granted compared to 6,419 last year. Private permissions fell very slightly to 36,690 from 36,708.
As HBF has long stressed, in his Autumn Statement, Chancellor George Osborne acknowledged the need to make changes to the planning application process. His commitment to introduce new measures to speed up the time taken and reduce the cost of getting planning permissions must be delivered as soon as possible.
Similarly, the DCLG Select Committee report into the operation of the NPPF (published this week) concluded that the NPPF was the essential base from which consistent decision making could occur, delivering an increase in land for housing. The report has made some recommendations to tweak the NPPF to iron out some initial teething problems, but categorically states that fundamental changes to the NPPF are not only unnecessary but would be harmful to the emerging trend of positive planning reflected by the long term trends within HBF’s Housing Pipeline figures.
Stewart Baseley, Executive Chairman of the HBF, said: “Since its introduction, the NPPF has delivered steady increases in the number of planning permissions. Allied to an increase in demand, primarily down to Help to Buy, this has enabled house builders to ramp up much needed housing delivery.
“Government cannot though be complacent. It is imperative it monitors the planning system closely and ensures it evolves so that it delivers planning permissions at the rate required to address our housing crisis.
“We are still only building around half the number of new homes the country needs. Getting the required number of permissions, in a timely manner, is absolutely key to the industry’s ability to deliver. In addition more needs to be done to speed up the plots that are awaiting final approval to allow construction to commence.
“Increasing housing delivery will provide the high quality homes our next generation needs, support thousands of companies up and down the land and create tens of thousands of jobs.”
The HBF/Glenigan report is a strong forward indicator of future levels of home building. A large proportion of these homes will be built over the next two to three years. Builders are looking to start work on new sites as they build out their existing sites more quickly as demand for new homes increases, driven in particular by the Help to Buy Equity Loan scheme, but far too many sites are still stuck in the planning system.
Allan Wilén, Glenigan’s Economics Director said: “The flow of private sector projects remains firm. The current year has seen a number of larger schemes gaining approval and this has contributed to a 30% rise in the number of homes approved on private sector projects during the first nine months of 2014. In contrast, social housing approvals remain on a downward trend and tempered growth in overall planning approvals to 20% during the first nine months of this year.”
