Town hall bosses have denied the planning system is to blame for the lack of new housing as experts renewed calls for the Treasury to lift borrowing caps and allow local authorities to build up to 75,000 new homes over the next five years.
The call comes following research published today by the Local Government Association (LGA) showing nearly 400,000 homes in England remain unbuilt despite having gained planning permission.
Town hall bosses warn the findings of the study, carried out by construction analysts Glenigan, indicate developers are sending through fewer planning applications – a situation they fear could undermine the prospect of a sustained housebuilding recovery.
Stoking concerns, preliminary findings of the study – which will be released in full next month – reveal the backlog in homes with planning permission only reduced by 6,000 last year. In addition, home completions now take on average 27 months from receiving approval, seven months longer than in 2007/08 and two months more than 2011/12.
Cllr Mike Jones, chairman of the LGA's environment and housing board said the new figures conclusively demonstrate that the planning system is not holding back housebuilding, with councils approving nine out of 10 planning applications.
‘The challenge now lies in actually getting houses built,' Cllr Jones said.
‘Government schemes to help buyers access finance risk creating a bubble without a matching increase in housebuilding,' he warned.
‘New homes are badly needed and councils want to get on with building them. The common sense answer is for the Treasury to remove its housebuilding block and get on with it,' added Cllr Jones.
Grainia Long, chief executive for the Chartered Institute of Housing told The MJ: ‘Allowing councils to borrow more to invest in housebuilding is a no-brainer because it introduces another high volume provider of new homes.'
‘Lifting borrowing caps by £7bn would allow local authorities to build up to 75,000 new homes over the next five years, creating 23,000 jobs and £5.6bn of economic activity every year,' Ms Long added.
National Housing Federation policy leader, Pippa Read, said the research suggests the Government must work on a comprehensive national housing strategy if it is serious about addressing the supply issue.
A spokesman for the Treasury told The MJ: ‘Last year's Housing Revenue Account reforms gave local authorities unprecedented freedoms in running their housing businesses. As well as providing certainty about revenues, councils can now also invest efficiency savings back into their stock of housing.'
The spokesman refuted the LGA's claim that lifting the cap would allow the government to create jobs and boost the economy without ‘having to find a single extra penny'.
‘Allowing local authorities to borrow more would increase public spending and require reductions elsewhere to fit within the Government's spending plans,' the spokesman said.
However, local government experts pointed out to wider issues affecting housebuilding. Simon Parker, director of the New Local Government Network think-tank said councils have a role to play in persuading developers to stop merely sitting on landbanks, awaiting greater profits, by building the first of a new generation of councils houses.
‘Local government could provide healthy competition to private developers by entering into joint ventures to provide more high quality, affordable housing in the social and commercial sectors,' Mr Parker said.
Housing minister Mark Prisk said the Government had restored confidence to the housing market and dismissed the findings as ‘misleading' for not showing the progress of construction on new developments.
‘In fact, Glenigan's own figures published in June this year show there were only 60,500 sites on hold, and over £1bn of Government investment is helping to unlock many of these stalled sites,' said Mr Prisk. He also pointed to latest statistics showing that house-building increased last year in 178 of the 326 councils in England.
