Last week the Home Builders Federation published its latest Housing Pipeline report which revealed that local authorities granted approvals for 45,041 new homes across England in the fourth quarter of last year, up 62 per cent year on year and 33 per cent up on the previous quarter.
It is the highest quarterly number granted since the first quarter of 2008 and – while still short of the 60,000 required – is significant as it points to potential improvement emerging since the introduction of the National Planning Policy Framework last March.
So clearly it has been an extremely positive start to the new year, with signs of an easing of the two main blockages that have greatly hindered our industry.
But significant threats to any sustainable recovery remain.
The increase in residential permissions is hopefully a reflection of the positive planning principles of the new system.
It is still early days though and the increases must be sustained.
The Government must ensure the system continues to be underpinned by a robust appeals process where local authorities are not meeting the responsibilities they have to their communities.
The lack of affordable mortgage lending has strangled the industry’s activity for several years and any glimmer of increased lending or lower rates is positive.
NewBuy is playing a big part and gaining substantial momentum, boosted by recent reductions in mortgage rates in response to the Funding for Lending Scheme.
The Government-backed NewBuy scheme has gained considerable traction, with a weekly average of 130 reservations, almost double last year’s average, resulting in a current cumulative total of more than 3700 reservations.
The doubling of reservations under NewBuy this year has come in partnership with a general lowering of mortgage rates – triggered by the Funding for Lending Scheme – making home ownership more affordable.
House building is a long process so it is vital that the Government maintains this support.
As the Government looks for ways to maintain this improvement it must also focus on its commitment to reduce red tape costs. Direct and indirect taxation, coupled with regulation, is making many building sites unviable and has got to be addressed.
Building the homes we need would take millions of people off social housing waiting lists and enable beleaguered young families to get a foot on the housing ladder. It could also create half a million new jobs and give the country a massive and much-needed economic boost. We are seeing progress – we now need to maintain it.
Housing units by region (Source: Gelnigan, HBF):
Housing units England: