New home planning permissions grow, but are smaller sites being ignored?

Over 290,000 new homes were granted planning permission in 2016, the highest annual total since the Home Builders Federation (HBF) housing pipeline survey began in 2006.

The figures are a strong indicator that increases in housebuilding are set to continue.

However, the survey also revealed that the number of sites granted planning permission in 2016 (17,500) fell by 11% when compared with 2015 (19,600), indicating permissions are being granted on larger ‘strategic’ sites.

While the headline number of plots granted permission now exceeds the pre-crash peak by around 15%, the number of sites on which those homes could eventually be built is down by more than 10% on the same period.

HBF Housing Pipeline
Results from the HBF Housing Pipeline survey
Due to infrastructure requirements on larger sites, these permissions tend to take longer to start being delivered as HBF warned local authorities to be realistic about the rate at which large sites can deliver and not to expect one large site to address their housing requirements. 

The HBF wants local authorities to work with developers to determine accurate build-out rates so they can accurately predict the number of homes being delivered on a site and, therefore, the overall housing delivery in that area.

“We welcome the fact that local authorities continue to increase the number of planning permissions being granted,” said Stewart Baseley, executive chairman at HBF.

“The number of permissions being granted is a strong indicator of future housing supply and will feed through into completed new homes in the years to come.”

The average permissioned site has increased by 16% in the last 18 months as councils with ever-stretched resources focus on larger sites.

HBF believes this highlights the problems small housebuilders face in finding suitable sites and progressing them through the planning process.

“The drop in the number of sites on which the permissions are being granted on is concerning,” added Stewart.

“As the [recent housing] white paper indicates, we need to ensure that permissions are being granted on a mix of site sizes and that local authorities are not reliant on one or two large sites. 

“A mix of site sizes will better ensure a flow of housing completions and also enable SME builders to play their part in delivering new homes.”

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