Barriers to housebuilding must be removed urgently as too many people are living in expensive, unsuitable and poor quality properties, according to a House of Lords committee.
Skills shortages must be addressed, planning departments need more resources, and money spent on housing benefit should be invested in increasing the social housing stock over time, the cross-party Lords Built Environment Committee said.
Uncertainty and delays to planning reforms have had a “chilling effect” on housebuilding and created uncertainty for housebuilders and planners, it argued.
It also called for the role of small and medium-sized businesses (SMEs) to be boosted to help meet housing demand.
The committee’s report said: “The challenges facing the housing market have been well documented: too many people are living in expensive, unsuitable, poor quality homes.
“To address these complex challenges in the long term, it is necessary to increase housing supply now.”
Uncertainty and the absence of a clear policy direction has only exacerbated housing problems
Baroness Neville-Rolfe, Built Environment Committee
Halifax’s latest monthly housing market report released last week said UK house prices hit new record highs eight times last year. The average UK house price ended 2021 on a record high of £276,091 in December.
Many recent housing market reports have pointed to a lack of homes available on estate agents’ books, placing an upward pressure on prices and making it harder for people to get on the property ladder.
The Lords committee said the role of SMEs in the housebuilding industry had “collapsed”.
They should be supported by reducing planning risk, making more small sites available, and increasing access to finance, it added.
More housing is also needed which is suitable for elderly people, it said, with one in four people in the UK set to be aged over 65 by 2050.
Government figures show skills shortages accounted for 36% of construction vacancies and 48% of manufacturing and skilled trades vacancies, the committee said.
Shortages must be addressed, through broadening the base of talent, upskilling and reskilling, including for the green skills needed to address climate change, it added.
It also claimed Right to Buy schemes are not good value for money and increasing the housing supply would be more effective.
Committee chair Baroness Neville-Rolfe said: “The Government’s ambitious target of 300,000 new homes per year will only be met if Government takes action to remove the barriers for housebuilders, particularly for SMEs who 35 years ago built 39% of new homes but now build just 10%.
“Uncertainty and the absence of a clear policy direction has only exacerbated housing problems. Our report provides a package of proposals to help deliver much needed housing and address the critical undersupply of new homes.”
Builders, small builders in particular, are increasingly strangled by a planning process that is under-resourced and ill-equipped for the 21st century
Home Builders Federation spokesman
A spokesman for the Home Builders Federation said: “While housing supply has doubled over the past decade, builders, small builders in particular, are increasingly strangled by a planning process that is under-resourced and ill-equipped for the 21st century.
“The country faces a well documented and critical housing emergency but the complexity, risk and inefficiency of the approval process is resulting increasingly in a reliance on larger site, which themselves take years to process.
“While the overarching planning system attracts much attention, it is the day-to-day operation of the process that is causing most frustration and preventing homes being built.”
A Department for Levelling Up, Housing and Communities (DLUHC) spokesperson said: “We welcome this report and share the ambition to reform the planning system to meet the demand for more high-quality homes and create a fairer housing market.
“Despite the huge challenges faced during the pandemic, we delivered more than 216,000 homes in England in 2020/21 – well above the 186,500 forecast for the whole of the UK – and are investing a further £12 billion in affordable housing over the next five years.”
Councillor David Renard, Local Government Association housing spokesperson said: “We fully support the committee’s call for more investment in increasing social housing stock, if we are to tackle the housing crisis.
“By giving councils the powers and resources to build 100,000 much-needed social homes a year, we can help the Government meet its annual target of 300,000 new homes. This should include further reform of Right to Buy.
“While planning is not the barrier to housebuilding, with nine in 10 planning applications approved by councils, the committee is right to highlight the need for planning authorities to be adequately resourced.”