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Home Planning & Construction News One in three homes with planning permission
left unbuilt
 * Planning & Construction News


ONE IN THREE HOMES WITH PLANNING PERMISSION LEFT UNBUILT

June 27, 2024
292


SINCE 2015, OVER A MILLION HOMES GRANTED PLANNING PERMISSION IN ENGLAND AND
WALES HAVE BEEN LEFT UNBUILT, ACCORDING TO THE INAUGURAL PLANNING PORTAL MARKET
INDEX

The first Planning Portal Market Index has found that around a third of houses
granted planning permission in the last decade have been left unbuilt.

Since 2015, over a million homes in England and Wales have not realised their
plans since gaining planning permission.

The data is a concerning insight on the ability to realise planning
applications, as 90% of applications made to local authorities in these two
regions are made through the Planning Portal.


THE PLANNING SYSTEM IS NOT THE ONLY OBSTACLE TO NEW HOUSING DELIVERY

If all of the homes in England and Wales granted planning permission over the
same period completed their works, the government target of 300,000 new homes
built per year would have been achieved for eight years.



Planning Portal is operated by TerraQuest, whose chief executive Geoff Keal
commented: “These figures suggest that the near-exclusive focus on the planning
system in the political debate around housing is misplaced. Until recently,
planning permission was being granted for enough new homes to meet the
government’s targets.

“While the planning system is by no means perfect, and those homes granted
permission could be in the wrong places, this data strongly suggests that
policymakers need to look more widely at the factors stifling the completion of
homes for which planning permission has been granted.”


HIGH INTEREST AND GENERAL COSTS CONTINUE TO STIFLE CONSTRUCTION WORK

Geoff continued: “High interest rates have a double impact on the completion of
new homes. By dampening the housing market in the short term, they limit the
potential commercial rewards available to housebuilders for proceeding with
projects. At the same time, the high cost of borrowing to finance projects in
the first place pushes up costs and eats into developer profits.

“This is compounded by the well-publicised challenges facing the construction
sector in overcoming skills shortages that have left its headcount more than a
quarter of million short of the number needed to meet projected demand.
Meanwhile, the supply of fundamental construction supplies of bricks and blocks
are down by 4.3% and 9.8% over the year to April, according to official
statistics.

“Our analysis shows just how profound the challenges are for policymakers in
ensuring enough new homes are built to meet the needs of a growing population.”

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