HBF reports continued fall in planning permissions
The latest Housing Pipeline Report from the Home Builders Federation has revealed a further decrease in planning permissions, with the number of approvals now the lowest for a twelve-month period since records began in 2006.
The report – which covers the final quarter of 2023 – reveals that 10,527 developments were granted permission in 2023 in England; a fall of -16% against 2022 and -23% on 2021.
The number of units approved in 2023 fell by -20% when compared to 2022, at fewer than 233,000 homes.
The number of social housing projects rose sharply during the fourth quarter of 2023, rising by 36% on the previous three months to 105 sites.
Regionally, the North West, East of England, South East and Scotland were the only parts of Great Britain that saw a decline in unit approvals during the fourth quarter. However, approvals more than doubled in the North East and London.
As we have been warning for some time, the sharp decline in housing supply is the inevitable result of several years of anti-growth policy and rhetoric.
The politically driven weakening of the planning system will impact housing supply for years to come and needs to be urgently reversed.
Stewart Baseley, Executive Chairman, Home Builders Federation
New work increases in January as upturn appears on the horizon
Official figures from the Office for National Statistics have found that construction output increased by 1.1% in volume terms in January, driven by a 1.1% increase in new work.
However, over the three months to January, construction output fell by -0.9%, with the value of new construction work falling by -4.5%.
The news comes as the latest UK Market Intelligence report from surveying firm Turner & Townsend urges clients to begin planning for an improvement in construction activity.
The firm also increased its inflation forecast for the UK construction industry to 3.2%, up from 2.7% previously predicted in December.
Whilst still acknowledging “continued headwinds”, the report encourages investment decisions to be “made not delayed”, albeit it notes that private housing output declined for the eighth consecutive quarter in Q1 2024, falling by -8.0% on the previous three months.
Cross-party forum launches women in housebuilding initiative
The All-Party Parliamentary Group (APPG) for SME Housebuilders has launched the ‘I am a Housebuilder’ initiative, which aims to improve the representation of women in small to medium housebuilding businesses.
The APPG also said that out of the 2,000 SME developers currently trading, fewer than 2% are owned and led by women.
Seven female SME housebuilding leaders will drive the campaign, which centres on three pledges:
- Increase visibility of successful women within the sector to attract more women to apply for roles
- Create a senior mentoring network to help women into leadership positions.
- Work in partnership with trade bodies and organisations to positively promote the sector to women of all ages, when recruiting from apprenticeship to the board room.
Andrew Lewer MBE, APPG chair and Conservative MP for Northampton South, who established the initiative, remarked on the “need to reshape the public perception of the housebuilding industry”.
We want to put an end to this once and for all. It’s time for the industry and the legislature to work together to reverse the decline of SME housebuilders and encourage more women into the sector.
By increasing diversity, we will open this great industry to more innovation and growth, which will be a major step towards rebalancing the housebuilding sector as a whole.
Andrew Lewer MBE
CMA to review proposed Barratt Redrow deal
The Competition and Markets Authority has confirmed that it is investigating the anticipated £2.5bn deal between Barratt and Redrow.
The combined housebuilder – which could build more than 22,000 homes a year – is under review to identify whether the merger could result in a substantial lessening of competition within any UK markets.
Meanwhile, partnerships developer Vistry has reported an increase in revenue and pre-tax profit in line with its previous year.
Reporting on the year ending 31 December 2023, the firm reported pre-tax profit of £419m as it built 16,118 new homes in the year.
Meanwhile, Persimmon reported a -52% fall in pre-tax profit over the same period, dropping from £731m in 2022 to £352m in 2023.
Completions were ahead of previous guidance thanks to “strong delivery” in Q4, at 9,922 new homes.
The Berkeley Group also released a trading update this week covering 01 November 2023 to 19 February 2024, forecasting that pre-tax profit for the current financial year ending 30 April 2024 would be around £550m.
The firm also reported that more than 70% of sales for the next financial year are already secured.
Housing View 