The latest Housing Pipeline Report from the Home Builders Federation, containing data from Glenigan, shows a continued downward trend in planning approval figures for Q3 2024 in both the number of sites and units approved for development.
With just 2,260 sites approved in the months of July to September, this marks a 10% decline from the previous quarter and the lowest quarterly total recorded since the HBF reporting in 2006.
The rolling annual total of 10,180 sites approved also represents a record low, further illustrating the significant challenges the UK housing sector faces in meeting growing demand.
While the number of units approved during Q3 increased by 2% to 57,356, this is still 40% below the peak. The rolling annual total of 240,661 units saw a modest 1% rise from Q2 2024 but remains 6% lower than the same period in 2023 This decline in planning approvals highlights that, to meet the Government's target of 370,000 new homes annually, approvals need to increase by over 150%.
Regionally, the decline in planning approvals has been especially pronounced in the North East, Yorkshire & the Humber, and the West Midlands. Although regions like London saw slight increases, the numbers remain far below historic levels.
The regional disparities further complicate efforts to address the national housing crisis, with areas in greatest need of new homes facing the most significant barriers to development.
These figures highlight the urgent need for targeted interventions to address the decline in planning approvals. While recent government announcements, such as the updated NPPF have been encouraging, swift action is still required to streamline the planning process, tackle regional imbalances, and ensure the necessary infrastructure for new developments.
Government also needs to address the lack of available affordable mortgage lending that is suppressing the huge real demand for new homes and is particularly hampering first-time buyers and young people’s ability to get on to the housing ladder. This uncertainly in the market, allied to the lack of Registered Providers in a position to take on the affordable homes provided as part of the planning permission, is preventing house builders from investing in new sites and planning permissions and pressing the accelerator on housing supply, despite the positive planning interventions the Government has made.
The latest report data for Q3 2024 shows:
- The number of sites achieving planning permission in Q3 2024 was 2,260, a 10% drop from the previous quarter and the lowest quarterly total since 2006.
- The rolling annual total of sites approved is 10,180, marking another record low.
- The number of units approved during Q3 2024 was 57,356 - a 2% increase from the previous quarter but still 40% below the peak.
- The rolling annual total of units approved stands at 240,661, a 1% increase compared to Q2 2024 but 6% lower than the same period in 2023.
- The number of units approved in the last 12 months still needs to increase by over 150% to meet the Government’s 370,000 annual housing target.
- Regional declines include:
- Looking regionally, some areas saw a greater drops in the number of units being approved. In the North East with a 61% decline in planning approvals Yorkshire & the Humber with a 49% decline and West Midlands with a 55% decline.
- Regions such as London saw slight increases, but approvals are still far below historic levels, with 44,000 units approved in the last 12 months—just 66% of the peak levels.
- Looking to the number of projects being granted approval, there was a decrease compared to the previous quarter across all the regions except the North East, which saw a minor increase of 3%. The sharpest declines were in the North West (-19%) and Yorkshire and the Humber (-18%).
Neil Jefferson, Chief Executive of the HBF said: “The continued decline in planning approvals is deeply concerning and underlines the scale of the challenge we face in addressing the country’s housing crisis.
“The recent efforts by the Government to reform planning policy are very welcome, but the data makes it clear that much more needs to be done to reignite housing delivery. Planning approvals will need to increase by more than 150% to meet the Government’s target of 370,000 homes annually, which is a huge leap from the current figures.
“We are seeing significant regional variation, with some areas experiencing severe drops in approvals, while others, like London, are still well below previous levels. This discrepancy highlights the need for targeted interventions that not only speed up planning processes but also provide clear support for both developers and homebuyers.
“The lack of affordable housing is impacting communities across the country, and without a stable demand for new homes, the industry lacks the confidence to invest in building the homes that are desperately needed.
“Increasing housing will require going beyond planning reform and addressing broader issues such as financing for homebuyers and a lack of providers in the market to take on the affordable housing developers build.
“Continued intervention from the Government will be crucial to ensuring we have a robust housing market that can deliver for the nation and tackle the housing crisis head-on.”
