The North East of England needs to see the largest improvement to meet the government’s housebuilding ambitions, analysis from West One shows.
Under previous standards, some 6,123 homes a year were required by government calculations, however, under the new ‘standard method’, this figure will now sit at 10,976 – an increase of 79.2%.
According to the new framework, Local Housing Need requirements across England are set to increase by 21.4%, bringing the new target to 370,000 homes per year.
Guy Murray, co-head of short-term finance at West One Loans, said: “Our new Labour government has been quick out of the blocks with respect to new housing delivery and their introduction of grey belt land classification is certainly one of the more positive steps we’ve seen in recent times.
“However, whilst admirable, their target of 370,000 new homes per year seems ambitious at best, particularly when you consider the failure of the previous government to come anywhere close to its target of 300,000 new homes per year.
“The key to boosting housing delivery is developer incentivisation and this can take many forms from tax breaks, grants, credits or rebates, or via improvements to help streamline the process, such as easing zoning regulations.
“Of course, the biggest incentive is a buoyant market and we’re yet to see the current government make any real statement with respect to stimulating buyer demand levels, in fact, they’ve done quite the opposite by failing to extend current stamp duty relief thresholds beyond the end of March.”
In the North West, the number of homes now required on an annual basis has increased by 61.3%, with the South West (41.8%), South East (37.9%) and Yorkshire and the Humber (33.5%) also seeing some of the largest increases.
The lofty housebuilding targets seem unrealistic based on historic standards.
During the Autumn Budget in 2017, the government set out plans to reach 300,000 net additional dwellings by the mid-2020s.
An ambitious target when you consider that over the previous 10 years, the closest it came to achieving such a goal was in 2007/08 when 223,534 additional net dwellings were delivered.
In the years that have followed, they have also failed to come close, with 2021/22 seeing the highest number of net additional dwellings delivered at 234,462 and no real consistency achieved in terms of increased delivery rates on a year-on-year basis.
