Expert view on whether the government's new housing plans will work
The new government has promised to deliver 1.5m new homes over the next five years. It’s only a third of what is needed, yet it still shows some much-needed ambition ambition.
Angela Rayner recently announced various new measures, including new mandatory planning targets for councils that must now also have up-to-date town plans, an overhaul of the planning system, a 50 per cent target for affordable housebuilding and the targeting of certain green belt land, renamed grey belt.
New towns got a mention. It all sounds plausible, but a few hurdles lie ahead.
The Tories lost a 2021 by-election on the back of their planning reforms and there is likely to be a further backlash when these broad policy statements translate into diggers on the ground locally.
Will Labour stick to their guns? I suspect a tricky time lies ahead for Labour MPs who will have to justify the policy locally.
The grey-belt concept has legs, building on ugly areas like car parks and petrol stations in the green belt but reports suggest it would only accommodate 200,000 new homes, so it’s no silver bullet.
New towns sound feasible but we will need quite a few. Milton Keynes is our most successful, with 125,000 homes but more recent efforts, such as Northstowe in Cambridgeshire, have barely scraped 1,500 units after seven years.
One key learning the government should heed is to prioritise infrastructure ahead of housing. Building new homes without amenities creates pressure on neighbouring areas and everyone loses out.
Currently, housebuilders are obliged to build a small proportion of their new housing estates at cost. But if this affordable housing proportion were increased to 50 per cent as the government intends, the remaining units would need to be priced significantly higher to ensure that developers made a sufficient profit.
If these higher prices were unsustainable then developers simply won’t build, and it is unclear how the government plans to address this.
Our planning system urgently needs a major overhaul, and our local planning teams also need significant investment. The government is funding a 1.7 per cent increase in planning officers, but this a drop in the ocean.
Much more needs to be done to create the certainty in planning that developers crave, so essential for building new homes.
The government’s best bet comes from redeveloping unwanted brownfield land, which could deliver a possible 1.2m new homes. However, the larger housebuilders are not interested in brownfield. The sites are too small and fiddly and lack sufficient profit to interest them.
So, who will come to the rescue? The answer is the increasing band of smaller developers. Many of these people are existing landlords who, having been taxed and regulated and have finally found a property opportunity that makes good money and which the government supports.
In all of this the devil will lie in the detail and while Labour may have passed the ambition test on housing, the delivery test will be by far the sterner one.
Ritchie Clapson, CEng MIStructE, is a veteran property developer, an author, industry commentator, and co-founder of the leading property development training company propertyCEO.
Ritchie is passionate about tackling the housing crisis and helping ordinary people to be part of the solution. Visit www.propertyceo.co.uk