Groundhog Day for housing delivery

By Scott Harker

On the face of it, this year’s Housing Delivery Test figures paint a picture of a healthy rate of housebuilding in the UK. The data shows that over 70 per cent of councils met their housebuilding target during 2021. This appears a healthy result given the Government’s ambitions for housebuilding yet, as ever, there are interesting points lurking in the small print.

The government was this year again forced to modify its traditional methodology of assessing delivery rates to account for the effects of the COVID-19 pandemic. The total is usually calculated over a three-year (36-month) period, this year the figures made use of a 31-month window and discounted months where COVID-19 restrictions were particularly strict.

The rationale for this is easy to understand: lockdowns, isolation and supply chain problems have combined to slow housebuilding and completions during 2020 and 2021. Unfortunately, this does not negate the impact of the months where activity was low. Without the presumption in favour imposed upon authorities that persistently fail the test, it appears unlikely that such shortfalls will be made up with an excess in future years. Analysis by Savills indicates that were it not for the Government’s amendments to the methodology, only 61 per cent of authorities would have met their targets.

Even with the methodology changes, the geographic concentration of the local authorities that failed to meet the requirements of the test is also a cause for concern. For the second year running, the bulk of the worst performers are concentrated in the South and South East around London. With the exception of Bromsgrove in Worcestershire, authorities in these areas accounted for the entire bottom ten.

Take a consistent poor performer on the delivery test as an example, Epsom and Ewell followed up its 34 per cent delivery score in 2020 with a tepid improvement to reach 35 per cent in 2021. Only a little over a third of the authority’s target has been delivered over the previous three years. The challenges faced by the authority are familiar to many areas in the southeast; strong demand to live in the area mixes with green belt constraints and community campaigns against development to slow delivery.

It's hard not to think that the area was one of those that the former Secretary of State for then-Housing, Communities and Local Government and Dominic Cummings had in mind when they proposed sweeping reforms to implement a zoned planning system that would have established planning permission in principle across a range of sites and weakened green belt protections. Such proposals have now been shelved to be replaced with a much more popular solution: talking lots about brownfield.

Now that he has had time to establish himself in his position, it seems that Michael Gove is pursuing a more astute course than his predecessor, yet it shows little promise of addressing long term delivery and affordability problems in the South East.

A report last year by the property consultancy firm, LandTech, indicated that Epsom and Ewell could reverse its poor performance and meet its housing delivery target by building on just 1 per cent of the land designated as greenbelt in the borough. However, such a solution appears to be far off.

Hopefully next year’s housing delivery figures don’t require any further COVID-related adjustments, just don’t expect much change at the bottom.