Planning Permission in Decline: A Growing Crisis Threatens the UK Housing Sector

The UK housing sector is on the brink of a major crisis as planning permission approvals continue to decline, raising alarms across the industry. Recent figures reveal a sharp drop in planning applications and approvals, casting serious doubt on the government’s ability to meet its housing targets. Experts warn that without swift reforms, the country could face even deeper housing shortages, skyrocketing prices, and a weakened economy.

Key Statistics:

• 9% Decline in Planning Applications: From April to June 2024, district-level planning authorities in England received 84,400 planning applications, down 9% from the same period in 2023 (UK).
• 7% Decline in Approvals: Only 70,200 applications were granted, a 7% drop year-on-year (UK).
• 8% Decline in Major Housing Approvals: Approvals for housing schemes with 10 or more units fell by nearly half (43.8%) compared to 2016/17, marking the lowest level in over a decade (GOV.UK).
• Regional Disparities: London saw a 20% drop in planning approvals, while the North East experienced a 36% decline, exacerbating regional imbalances (UK).

The Expert View:

“The UK planning system is increasingly at odds with the scale of the housing challenge we face,” says Ellie Laws, Head of Planning and Chartered Town Planner at Planning By Design. “We are seeing fewer applications and even fewer approvals, which directly impacts the country’s ability to meet the growing demand for new homes.”

This poses a serious threat to the economy. The construction sector employs 1.5 million people and contributes nearly 10% of the UK’s GDP. But without an increase in planning approvals, the ripple effects will be felt in rising home prices, reduced housing stock, and fewer large-scale developments key drivers of economic and social growth.

Housing Schemes in Decline:

• 12% Drop in Major Developments: Larger housing projects, which are critical to meeting national demand, were down 12% in Q2 of 2024 compared to the previous year.
• Increasing Delays: Major housing schemes of over 500 units now face planning approval delays of up to five years. Even single-unit developments take an average of 7-9 months to clear the planning process.

Laws warn that these delays are causing severe economic and social repercussions: “The UK’s housing crisis is worsening, particularly in areas of high demand like London, where refusals are rampant. We need urgent planning reform to streamline the process and restore confidence among developers.”

A Call for Urgent Reform:

Councils decided on 332,930 planning applications in the year ending March 2024 an 11.7% fall from the previous year, marking the lowest figure in a decade. The current system, experts argue, is unsustainable.

“There’s still a sense that planning approvals are a matter of chance,” says Laws. “With 30% of appeals allowed, the inconsistency and unpredictability are clear. Without a more transparent and predictable framework, we’ll continue to see a decline in new housing developments and the social and economic benefits they bring.”

Conclusion:

As the UK’s housing crisis deepens, the urgent need for planning reform cannot be overstated. The government must act quickly to simplify the planning process, support developers, and address regional disparities in housing approvals.

Ellie Laws emphasises, “The time for action is now. With the Labour government’s consultation on the revised National Planning Policy Framework (NPPF), there is a unique opportunity to tackle this crisis head-on and deliver the homes the UK desperately needs.”

For more insights on the current state of planning permissions and expert analysis on what must change, read the full blog post here: https://planning-by-design.co.uk/planning-permission-in-decline-a-growing-crisis-for-the-uks-housing-sector/

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