An integral Labour manifesto commitment is to be the party to ‘deliver the biggest increase in social and affordable housebuilding in a generation.’ In an effort to build 1.5 million properties by the end of the parliamentary term, Labour has set out several bold initiatives intending to quicken the pace at which development projects are constructed.
Such an objective underpins the New Homes Accelerator programme announced by Chancellor of the Exchequer Rachel Reeves on 8 July to tackle development project efficiency. Considering its importance to Labour’s property strategy, it is useful to highlight what this programme involves and explore its practical effects on the property market.
What Does the Programme Involve?
The New Homes Accelerator aims to tackle, by bringing together members of local planning departments, government agencies, and development organisations, a number of key areas related to the construction process. On 29 August, Deputy Prime Minister Angela Reyner outlined that ‘our New Homes Accelerator will quickly identify blockages, fix problems, support local authorities and developers get shovels in the ground.’
Crucially, this will involve not only increasing the speed of completion for construction projects, but it will also involve identifying more areas suitable for property development. This twofold objective is intended to occur by reducing the amount of red tape for planning approval, unblocking and preempting building delays, offering greater support to developers, and assisting development schemes with unit capacities greater than 1,500.
David O’Leary, executive director of the Home Builders Federation, assessed that ‘adopting a pragmatic approach to planning will increase the pace at which new homes are built and help to turn around ailing housing supply.’
Moreover, Architects Action for Affordable Housing commented that ‘our supporters will have many examples of developments that could and should be accelerated to provide much needed affordable housing. We appreciate that some blockages are with planning and welcome the additional resources that could help bring more timely and predictable decisions.’
Turbocharging all stages of the development process and mitigating obstacles slowing down construction completion is central to what Reeves previously described as moving past the ‘graveyard of economic ambition.’ This overhaul addresses the shortages in property supply, hence its emphasis on enhancing development efficiency.
What Does this Mean for the Market?
Government data revealed that the programme could unlock up to 300,000 properties in 200 development sites across England, a figure which would significantly contribute towards meeting ongoing demand, as well as stimulate economic activity in key regions of the country.
Since the announcement of the programme in July, over 14,000 homes are set to be completed in Sutton Coldfield, Worcester, Northstowe, and Liverpool. Elsewhere, the programme is accelerating the development of up to 10,000 new homes in Biggleswade Garden Community in Central Bedfordshire, Stretton Hall in Leicestershire, and Tendring Colchester Borders Garden Community in Essex. These early developments offer an exciting snapshot of the New Homes Accelerator’s potential.
Simon Vernon-Harcourt, design and planning director of City and Country, said that ‘it feels like the wheels are finally in motion to speed up the delivery of new homes by the Labour government, and they have shown some genuine appetite to get Britain building.’
According to Benham and Reeves, if Labour manages to hit the annual target of 370,000 newly built properties, it could inject a £161.6 billion boost in value to the national housing market. London, for example, is forecast to have an estimated £46 billion boost to its regional market.
Connected to this is the estimated increase in housing supply by 21 per cent across England. An important point is that smaller populated areas are expected to receive the biggest increases in housing expansion. Locations such as Hyndburn, Westmorland and Furness, and Burnley are projected for the biggest increases, with an overall 500 per cent more newly built houses expected to enter each regional market. North East England is also expected to receive an increase of up to 99 per cent if Labour’s figures are met. Pinpointing areas favourable for property development underlines the importance that the New Homes Accelerator will bring.
Marc von Grundherr, director of Benham and Reeves, stated that ‘not only could we see a very notable boost to the number of new homes reaching the market, but over the next five years these new homes would also bring a sizable boost to the overall value of the property market.’
What to Expect Going Forward?
The New Homes Accelerator is crucial for Labour precisely because it streamlines the construction process in order to make the system more efficient and less burdensome. Overhauling the construction process at all stages, alongside coordinating greater inter-governmental and developer collaboration, will mitigate the obstacles in reaching the ambitious 1.5 million housing goal.
Expect the New Homes Accelerator to be a cornerstone initiative of Labour’s housing strategy, for it will form the basis that construction will commence under the present parliamentary term.
