The government’s flagship target of building 1.5 million new homes in England over the current parliament is facing serious questions about its deliverability, as data published by the Ministry of Housing on Wednesday showed that planning approvals for residential developments fell 12% in the year to March 2026 compared to the previous year — the opposite direction to that required if housebuilding is to accelerate to the levels needed to meet the target. The figures have intensified pressure on Housing Secretary Angela Rayner to demonstrate that the Planning and Infrastructure Bill, currently making slow progress through the Lords, will deliver the fundamental reforms needed to unlock the housing pipeline.
The headline figures conceal significant regional variation. London, where the planning system is most complex and land values highest, saw approvals fall by 18%, with several large development schemes in outer London boroughs stalled by a combination of legal challenges, infrastructure funding disputes and community opposition. By contrast, some areas of the Midlands and North reported modest increases in approvals, suggesting that the planning constraints are most acute precisely where housing demand and land values are highest.
Housebuilders have pointed to several structural barriers that they argue are preventing a significant acceleration in output. The planning system remains slow and unpredictable, with major applications taking an average of 26 months to receive a decision — up from 19 months in 2020. Nutrient neutrality rules, which require developers to demonstrate that new housing will not increase nutrient loads in sensitive river catchments, are blocking approximately 150,000 homes in planning. And the cost of providing affordable housing and infrastructure contributions required by local authorities has risen sharply, reducing the viability of schemes that would otherwise proceed.
The government has argued that the Planning and Infrastructure Bill will address these systemic failures by introducing mandatory housing targets for local authorities, streamlining the national planning policy framework and establishing a new Infrastructure Levy to replace the current developer contribution system. However, critics — including many within the Labour Party itself — argue that the bill as currently drafted does not go far enough and that only fundamental reform of the land value capture system will deliver housing at the scale required.
Independent analysis by the Resolution Foundation suggests that meeting the 1.5 million homes target would require completions to reach approximately 300,000 per year by 2027 — nearly double the current annual rate of around 160,000. Most housing economists regard this as achievable in principle but extremely unlikely given the current pace of reform and the structural constraints facing the industry.
— Edward Blackwell, London Capital Post
