The Home Builders Federation says its industry needs cheaper mortgages and tax changes as well as planning reforms to meet government new build targets. 

The call comes as the HBF reveals 2024 saw planning permission granted for the lowest number of new homes for a decade, on the fewest actual house buildings sites granted a permission since the reporting series started in 2006.

In 2024, just 242,610 units received planning permission, the lowest total for any calendar year since 2014. This marks a 2% decrease from 2023 and a 26% drop from the 2019 peak, equating to a loss of over 85,000 annual approvals. 

To meet the Government’s target of 370,000 new homes per year, planning approvals must rise by 53%. 

The numbers are largely a reflection of the previous government’s approach to housing policy, the federation insists they also highlight the significant barriers that remain. 

And it says that whilst the new government’s intent and swift action to address the failings in the planning system have been welcomed by industry, the constraints on house building are much broader than simply planning.  

A lack of affordable mortgage lending is supressing demand, in particular from young people; and the inability of housing associations to take on the affordable housing provided as part of every planning permission is preventing companies from being able to invest in new sites. 

Additionally, it claims the increasing number of taxes being levied on the homes being delivered is making development across swathes of the country unviable and making the operating environment, especially for SME builders unworkable. 

Federation chief executive Neil Jefferson says:“Increasing housing delivery will require much more than just planning reform. 

“Government has to address broader issues like financing for homebuyers and ensuring there are sufficient providers in the market to take on the affordable homes developers are building – and reduce the crippling levels of taxation being planned and imposed that are making development across swathes of the country unviable. 

“In reality planning permissions and house building levels are falling and companies do not have the confidence to invest with SMEs in particular struggling and a growing number unable to continue to operate. 

“The industry is keen to press the accelerator and play its part in delivering the homes, but we also need further government intervention is urgently needed to enable it to do so.” 

Regionally, most areas experienced significant decreases compared to 2023. 

While the North West saw a 25% increase in planning approvals, areas like the East Midlands (-16%), London (-14%), and the West Midlands (-11%) saw steep declines.  

Smaller decreases were observed in Yorkshire the Humber and the South East. 

On projects, the East Midlands experienced the largest decline, with approvals dropping by 17%, while only the North East saw a minor increase of 0.4%.