Housing

Tories yet again fail to hit housebuilding target – and it's only going to get worse, experts say

An additional 234,400 homes were added to England’s housing stock in 2022-23 but it looks unlikely that the Tories will be able hit their 300,000-homes-a-year target by the mid-2020s. Here's why

housebuilding

The number of homes being built in England has increased under the Conservative government but it still remains far below the 300,000 homes a year target and levels needed to end the housing crisis. Image: Héctor Emilio Gonzalez / Unsplash

The Tories have failed to hit their housebuilding target of 300,000 homes a year once again, according to the government’s own statistics – and the future’s looking bleak for the housing crisis.

Housing supply in England increased by 234,400 net additional dwellings in 2022-23 – just 70 homes shy of the number recorded in 2021-22.

But the total additional homes remains way down from the pre-Covid high of 248,590 in 2019-20 and, crucially, the Tories’ 2019 manifesto promise of building 300,000 homes a year.

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That target isn’t supposed to be hit by the mid-2020s but the task facing Lee Rowley – the 16th housing minister appointment since 2010 – to hit that mark is a daunting one, experts told The Big Issue. 

Angela Rayner, shadow housing secretary, said: “The Conservatives have failed to hit their housing target each and every year since they set it. When swift and meaningful action is required, this government is taking us backwards, with fewer houses delivered than last year and a generation locked out of a secure home.

“The next Labour government will jump-start planning and get spades in the ground to deliver 1.5 million homes over the next parliament. Labour’s housing recovery plan will deliver the new homes our country desperately needs.”

How many homes are built in England each year?

The failure to build enough homes, particularly affordable properties, has seen successive governments fail to get to grips with the housing crisis.

While house prices have fallen in recent months due to the impact of rising interest rates, they have risen to record highs in recent years and remain almost £60,000 above pre-pandemic levels on average, according to the Office for National Statistics.

Meanwhile, private rents have shown no signs of slowing as they continue to rise to new heights.

Failure to build enough homes each year sees the gap between how many homes the country needs grow larger, meaning housing becomes even less affordable.

The government figures show 212,570 new-build homes were delivered last year alongside 22,160 properties which were changed from no-domestic to residential and 4,500 houses which were converted to flats. There were 640 other gains – including caravans and house boats – while 5,470 homes were lost to demolitions.

While, overall, the net additional dwellings looked stable despite rising inflation, it is likely that future years will see the number of additional homes fall.

Analysis from Noble Francis, economics director at the Construction Products Association, estimated the government is likely to miss its 300,000 net additional homes a year in England by the mid-2020s target by around 40%.

That’s because many of the factors affecting the number of completed homes are likely to show up in next year’s stats.

Anna Clarke, director of policy and public affairs at The Housing Forum, told The Big Issue she would be “very surprised” to see the total number of homes built in the current year reach 200,000. She estimated the figure could fall as low as 160,000.

The National Housebuilding Council’s statistics show the number of homes completed in the second quarter of 2023 were down 11% on the previous year, giving an early indication of what can be expected in next year’s government stats.

The fall in house prices and sales has slowed down developers’ delivery while the end of the Help to Buy scheme in March has also put off builders, Clarke said.

She also pointed to changes in building safety legislation and how Inflation has also made it harder for social landlords to cover the cost of developing much-needed social housing.

The controversy over nutrient neutrality rules has also had an impact, Clarke said, although environmental campaigners dispute the effect on housebuilding.

The government was defeated in its bid to scrap nutrient neutrality rules, which prevent rivers being polluted, in September. Ministers claim scrapping the rules could unlock 100,000 homes over the next decade.

Earlier this month, The Housing Forum released a report calling on the government to streamline planning rules by scrapping nutrient neutrality rules, embedding planners across other teams in local authorities and addressing staff shortages.

“The housebuilding sector can contract fast – and that is what we’re starting to see currently,” said Clarke. 

“But it struggles to bounce back quickly – recruitment of skilled workers can be hard and slow, and SMEs struggle to break into the sector or to grow. We urgently need government to support the housebuilding sector – and the best way of doing this is probably via the social housing sector, who could keep the sector building, whilst also building much-needed affordable homes.”

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