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Housing

Labour won't hit 1.5 million home target without putting up serious cash to get Britain building

The government’s housing plans will boost housebuilding but it cannot rely solely on the private sector and will have to spend big to build the homes required to tackle the housing crisis, Resolution Foundation analysis has found

Labour deputy prime minister and housing secretary Angela Rayner speaking in Parliament

Angela Rayner said her "radical" plan to boost housebuilding was "ambitious" and "controversial" to some. Image: Parliamentlive.tv

The Labour government is hoping mandatory housebuilding targets and planning reforms can deliver the 1.5 million homes it has pledged to end the housing crisis – but it won’t hit that mark without direct public investment in new homes, a think tank has warned.

Labour has set local authorities the goal of building 370,000 homes in a year in a bid to deliver the 300,000 properties needed annually to reach its target while in power. That milestone hasn’t been hit in a single year for more than half a century.

Resolution Foundation’s Building Blocks report said the announced reforms will boost housebuilding but a reliance on private sector housebuilding will not be enough to reach 1.5 million homes.

The Big Issue has previously reported how just six private companies could decide the fate of Labour’s bid to end the housing crisis.

Camron Aref-Adib, researcher at the Resolution Foundation, said: “The government has set an ambitious target to deliver 1.5 million more homes over the parliament, and followed up with welcome planning reforms to encourage private developers to get building as soon as possible.

“Giving local housing targets more teeth and opening up more land for development should help to boost housing supply, as long as the government holds its nerve against local opposition.

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“But while these reforms are necessary, they are not sufficient, as they rely too much on private sector delivery. If the government wants to build the 1.5 million more homes that Britain needs, there’s no alternative to direct intervention via greater public investment in affordable housing. That’s the only way Britain has built at scale in the past, and it’s crucial to delivering in the future too.”

The think tank report said making housebuilding targets mandatory – reversing a change made by the Tories last December – and changing the formula for setting targets should boost development.

Analysis found housebuilding targets have increased by nearly 50% on average across the most affordable half of local authorities under the new formula and just over 10% on average in the least affordable half, judging by house prices in relation to earnings.

That has seen housebuilding targets in London significantly reduced, which has sparked criticism from YIMBYs, although previous targets were unrealistic and more homes should be built under the new targets, the researchers said.

Labour has also promised to target brownfield land and low-quality green belt land, known as the grey belt, for development with reforms that could provide enough land to build over a million new homes.

The Resolution Foundation research found hitting 1.5 million new homes would require the use of underdeveloped land equivalent to the current grey belt. Or developers would have to build in higher density on brownfield and grey belt land, adding an additional storey onto around two in five new homes.

The government has promised to invest in 300 new planning officers to tackle delays in obtaining planning permission as well as intervening in stalled projects.

The think tank said the new roles are “small fry” compared to the number of planning officers axed during the austerity years of the 2010s when numbers fell from 15,000 to 12,000.

An ageing and shrinking construction workforce also casts doubt on the ability to get Britain building. The share of construction workers aged over 50 has grown from one in four in 2005 to a third two decades later.

But Labour will be going against the lessons of the past if it is to deliver 1.5 million new homes.

Think tank researchers said two in five homes were built through the public sector in 1968 – the post-war housebuilding peak year.

Private developers can deliver an additional 8,500 affordable homes per year, the report said, which would be enough to return supply to levels seen in the 1990s.

But the government will need to commit significant public spending to affordable housing in the upcoming Budget and spending review.

A significant increase in social housing is needed to end a housing crisis that has seen house prices soar beyond earnings, private rents hit new heights and a record number of families homeless and living in temporary accommodation.

Big Issue is among a number of housing organisations and charities who have called for more affordable and social housing to be built. Shelter has said that 90,000 social rent homes are needed every year for the next decade to tackle the housing crisis.

Labour has not set a public target for the number of social homes it hopes to deliver.

Announcing the government’s housing plans in July, housing secretary Angela Rayner called for a “council house revolution”.

She said: “Our decisive reforms to the planning system correct the errors of the past and set us on our way to tackling the housing crisis, delivering 1.5 million homes for those who really need them.”

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