Planning matters

Lichfields has launched the third edition of its award winning Start to Finish report on the build out of large-scale residential development sites.

The report looks at what happens on the ground, across 297 sites delivering a combined 387,000 dwellings, the largest sample we have studied. Previous versions of the report have become the industry standard for informing the production of realistic housing trajectories for plan making and decision taking across local plan examinations, planning inquiries and five-year land supply statements.

Things have moved on since the last edition which launched in 2020, now facing a General Election in which the polls suggest more change. Society and the economy was rocked by the Covid pandemic, war in Europe and the following soaring interest rates, mild recession and political (and policy) commotion, all contributing to significant market turbulence.

The housing market specifically is now in a very different place too, no longer shored up by Help to Buy loans and cheap mortgage rates. When the last version of Start to Finish was published in 2020, we had a recent peak of almost 325,000 permissions granted, and 249,000 homes being built. A recently re-elected Johnson-led Conservative government with a large majority was gearing up for a radical reform of the ‘outdated and ineffective planning system [1]’ including proposals aimed at boosting rates of on-site delivery following Sir Oliver Letwin’s independent review of build out. However, this change was superseded by the Truss premiership and then the realpolitik of delivering the LURA and NPPF reforms with an emboldened cohort of backbench rebels. As of 2024, housebuilding has fallen, (down 6% since our last edition in 2020 [2]) and permissions have plummeted, (permitted units down 30% since 2020 [3]).

For this reason, we look for the first time at the effects of market conditions on build out rates.

In this edition, for the first time we assess brownfield flatted schemes, we also have assessed the largest cohort of sites, especially sites of 2,000 or more dwellings where we have 43 more examples than in our second edition. The mean build-out rate decreased marginally for every site size from the second to the third edition. However, the build-out rates across all three editions show a relatively consistent level, which gives us confidence in the findings.

This is significant in the context of the objective the next government (of whichever party it might be) to boost levels of house building . The CMA [4] in its recent Housebuilding Market Study was clear in its findings that land banking is a symptom of the planning system rather than a cause of under delivery of housing. The methodology and findings of the CMA are broadly consistent with ours. We also agree – following the evidence we set out – with the conclusion of the CMA that the achievement of the necessary step-change in housing output is likely to be reliant on measures to improve the efficiency of the planning system and increase the amount of land available for development.

This third edition of Start to Finish, published in an election year, finds the housing market high on the political agenda and in a very different place to the last version. Up-to-date evidence on the build rate of different sites will therefore be vital to make effective evidence based decisions up and down the country. By considering the different factors that affect build out rates on both small and large sites – namely brownfield or greenfield land status, the housing mix on site, geography, affordability, the number of outlets and level of affordable housing – the latest edition provides the most robust and timely evidence available to support decision making.