The numbers for planning permission being granted across England for new-build houses fell sharply during the second quarter of 2023, continuing a downward trend seen over the past two years, according to the latest Home Builders Federation (HBF) Housing Pipeline report.
The report confirmed industry warnings that – in the midst of an increasingly anti-development policy environment and worsening economy – the number of homes built in the coming years could fall to record lows.
At 2,456, the number of projects granted planning permission during Q2 of 2023 was the lowest since the Housing Pipeline Report began recording in 2006.
This number was 10% lower than the previous quarter and 20% lower than a year ago, following a 9% decline in Q1 and a 9% decline throughout 2022.
HBF suggested this was evidence of a far reduced appetite for investment among house builders amidst a riskier planning environment, hostile political actions from ministers and wider economic circumstances.
Approval was granted for 62,681 homes during the second quarter, dropping 16% on the previous quarter and 13% as compared to the same period a year ago.
Other than the quarter affected by Covid-19, Q2 2020, this is the fewest permissioned homes in a quarter since 2015.
New homes and sites that gained planning permission during the first half of 2023 were 19% down on the equivalent period in 2022.
If this translated directly to completions, it would lead to a reduction in housing delivery of 44,000 homes per year, which would see Net Housing Supply for England fall to levels not seen for a decade.
HBF warned earlier this year that if unaddressed, the Government’s anti-development approach to planning and nutrient neutrality could see housing supply halve to around 120,000 homes a year.
Stewart Baseley, executive chairman of the HBF, said: “Over recent years the policy environment has become increasingly anti-development and anti-business and as a direct result we are seeing a sharp fall in the number of homes being built.
“The Government’s capitulation to the NIMBY lobby on planning, its mishandling of water legislation and amidst a lack of mortgage availability the lack of support for first time buyers could see housing supply drop markedly in the coming years.
“Fewer homes being built amidst an acute housing crisis has clear social implications, in particular for young people, and will reduce economic activity and cost jobs.”
Regionally, the sharpest decline was in Yorkshire and the Humber, down 54% on the previous quarter.
The East Midlands, London and the South West followed, with falls of 38%, 25% and 20% respectively.
Four parts of the country bucked the overall downward trend in approvals during the second quarter.
The North East, East of England, West Midlands and Wales all saw a double digit increase in approvals against the previous quarter, rising by 26%, 31%, 19% and 26% respectively.
