The Lords Select Committee on Economic Affairs has (yet another) report out – Building More Homes – on increasing housing supply. It’s more of an update than anything. There’s a lot of familiar points made and there isn’t really anything new. They provide some updated figures on the land holdings of the three top volume housebuilders who seem to want 4-6 years supply of plots with planning permission in their inventory.
|Homes completed in 2015||16,447||14,572||13341|
|Plots in ‘short-term landbank’||70,523||54,300||76,000|
|Plots anticipated from ‘strategic land holdings’||71,600||100,000||100,000|
They recommend that the Government should assess why there is a large gap between the number of planning permissions granted and the number of homes actually built. In particular it urged to identify who is holding permissioned land that is not developed. Apparently, approximately one third of planning permissions are not implemented. Apart from land investment (typically termed speculation and/or hoarding), other reasons can relate to current non-profitability of scheme, local market capacity to absorb new supply in the short term, potential ownership or other legal complications, the land is intended to be sold, ‘permission banking’, the need to deal with remaining planning conditions and, possibly, lack of construction capacity. Land investment is perceived to be a problem but we don’t really know the extent of it.