How will the government boost housing supply?

According to the Office of National Statistics, the number of new homes built in the year to March fell by 13% to 183,610 – similar to the number completed in the first year of the Covid-19 pandemic.

This is an enormous decrease from the target of 300,000 new homes per year by the previous Conservative government.

After winning the general election earlier in 2024, Labour set an optimistic housing target of 1.5 million new homes during their five-year term. As a result, Labour has set record-breaking targets to build homes to alleviate the growing housing crisis.

What is the current housing situation in the UK?

The UK currently has a backlog of 4.3 million missing homes, according to Shelter. Social house building in England is at its lowest rate in decades, leaving almost 300,000 people homeless. During the first 10 years of the Conservative government’s time in power, rough sleeping increased by 52%.

The Financial Times claims that local councils are currently spending £2.3bn on temporary accommodation for homeless households. These costs have doubled in the last five years, causing huge strain on local budgets.

What is Labour’s plan?

After winning the general election, Labour announced plans to reverse a number of the previous government’s changes to planning policies. The previous policies made it easy for anti-development local councils to stop house-building in their regions.

In August, Deputy Prime Minister, Angela Rayner, launched a new expert group of officials whose purpose is to unlock stalled developments.

The new unit, called the New Homes Accelerator, consists of around 15 officials and will be in full operation by the end of September.

Rayner said the new team will “quickly identify blockages, fix problems and support local authorities and developers to get shovels in the ground”.

For Rayner and the Labour party, there are two major plans in place to increase house building in the UK during their term in government.

Increase in new builds

Angela Rayner announced in July that Labour is targeting 370,000 new homes built each year in the UK – a significant increase on the Conservatives’ target of 300,000 (which they fell well short of).

To do this, a huge plan must be put into action to rapidly increase the production of new-build properties.

Labour has set out the following changes:

Major overhaul of the planning system, setting in place mandatory housing targets for councils.
Greenbelt review to identify ‘grey belt’ land and meet local housing needs.
A new system to ensure every area has local housing plans.

A new method will be put in place to determine how many homes are needed in specific areas to ‘better reflect the urgency of supply for local areas’.

Labour new towns policy

Another idea from Labour to increase house-building across the UK is to create a host of new towns.

The plan for the Labour new towns policy is to prioritise brownfield land to build affordable housing with a solid infrastructure, public services and green space.

The policy states that 40% of new homes have to be affordable, with a mixture of social, council and other tenures. ‘Beautiful buildings’ and tree-lined streets are also targeted so projects fit into their areas, paying close attention to local history and identity.

Housing must efficiently use all development land with links to other towns and city centres. As such, these new towns and houses will not be isolated and will boast excellent transport links to GP surgeries and schools.

What is the reaction?

The reaction to Labour’s plans has been mostly positive. Housebuilders in the UK have welcomed the urgent policy changes.

British housebuilder, Vistry, supported Labour’s plans in a recent trading statement: “We look forward to working closely with the new government and are supportive of their plans to introduce mandatory housing targets, reform the national planning policy framework, add new planning officers and prioritise brownfield and ‘grey belt’ land.”

Aynsley Lammin, an analyst at Investec, is a little more coy about the plans. Mr Lammin stated that “it will take time for the planning changes to be implemented and benefit the industry.”

Speak to housing experts

The new Labour government is urgently trying to get spades in the ground and houses built to alleviate the growing housing crisis.

There are plans in motion that will, hopefully, see housebuilders given the go-ahead to pick up stalled developments.

And, once these projects are given the green light, developers and contractors will require new-build warranties. Contact us today if you’d like to find out more information about our structural warranty choices.