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03/10/2017

HBF: Help to Buy has driven record rise in planning permissions

Words: Martin Read
Housing / iStock_000074406885

A report produced by the Home Builders Federation (HBF) in association with construction market analyst Glenigan has suggested that the Help to Buy scheme is having a significant impact on the housing market.

According to Stepping Up, a report produced to assess its impact so far, Help to Buy now accounts for one in every 12 first-time buyer transactions and is such a success that it is “driving industry confidence to invest in new sites at a time when activity in the market generally remains stubbornly slow”.

The study, which uses figures from the HBF and Glenigan’s Housing Pipeline reports, suggests that the number of planning permissions granted in the first half of 2017 was the highest for new homes on record. In total, permissions for 321,982 new homes have been granted in the 12 months to June 2017.

The Help to Buy scheme was introduced four years ago, and the organisation calculates that more than 200,000 people – most of them first-time buyers – now live in a new-build home as a result of the scheme.

The HBF credits Help to Buy as having helped the new-build and first-time buyer segment of the market to “buck the generally slower wider housing market”.

Figures from the Stepping Up report:

  • 228,000 – estimated number of people to have used the scheme
  • £44,000 – median household income for Help to Buy purchasers
  • 74 per cent – increase in homes granted planning permission between 2013 and 2017
  • £217,000 – average Help to Buy purchase price
  • 185,000 – Estimated number of first-time buyers getting on the ladder using Help to Buy

But the HBF notes that Help to Buy is set to end in 2021 and has used its report to ask for clarification from government on the scheme’s future. The body also expresses concern about the time taken to process permissions through to construction stage, with some projects taking up to four years.

Stewart Baseley, executive chairman at the HBF, said: “These figures are a clear indication that house builders are committed to increasing housing output. We’ve seen 50 per cent growth in output over the last three years and these figures indicate that progress can continue.

“Ultimately, if people can buy, builders can build, and confidence in demand is crucial to future build rates. The figures show that if demand for new homes remains strong and the planning system processes applications efficiently, further increases in build rates can be delivered in the coming years.

“We need confirmation from government as to the future of the scheme post-2021. We also need to see the proposals to improve the planning system outlined in the white paper moved forward and implemented.”

Allan Wilen, economics director at Glenigan, said: “The residential development pipeline continues to strengthen. The number of new homes securing planning approval during the first half of 2017 was 22 per cent up on a year ago. The increased supply of sites available for development demonstrates housebuilders confidence about market prospects with the industry well placed to meet the demand for new homes.”

Stepping Up can be found on the HBF website (pdf).

Image credit | iStock

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