The planning system has started to deliver large numbers of consents – sites for over 240,000 residential homes were permitted in the year to Q3 2015 – but there are concerns that this is not translating into increased delivery of homes.

A recent report by the Local Government Association (LGA) suggests that there are unimplemented consents for 457,945 homes in England. Our analysis tests this claim using similar data to examine sites of over 10 homes that have received full permission since 2011 and have not yet been fully completed. We have identified 5,702 sites with planning permission in the supply pipeline. These sites have the capacity for 532,000 homes, but our analysis shows that only a fraction of these could be considered ‘unimplemented permissions’.

The majority of homes (233,000) are on sites that are progressing towards construction or are on sites that have already started construction (276,200). Only 21,500 homes are on sites that are clearly stalled such as those classified as on hold, cancelled or for sale, but this status may reflect issues outside of the landowner or developer’s control.

Of the homes that have started construction, 44% are on sites that gained full permission in 2013 or earlier (red bars). The vast majority of these (85%) are on sites of over 100 homes. These sites can take several years to build out, and their delivery rates are limited by what the local market can absorb.

Our previous analysis of delivery on greenfield urban extensions of over 250 homes has shown that it takes on average nine months from receiving detailed permission to starting on site, typically because of the number of planning conditions to discharge. This can be further delayed if there are major infrastructure or site remediation requirements. Once under construction, large sites typically deliver an average of 120 homes per annum. At these rates, it is not unreasonable for a site of over 300 homes to have not yet completed three or four years after gaining full permission.

Of the sites yet to begin construction, 1,199 sites with capacity for 108,000 homes have a construction contract in place, while a further 216 sites, with capacity for 17,600 homes, are currently in the tender process. The greatest concern is reserved for the 1,466 sites that are yet to tender. They have capacity for 107,000 homes however 67% of these sites only gained permission in the last year.

This does leave 47,000 homes on 480 sites that gained full permission over a year ago and are, at best, slowly progressing towards construction. There are many possible reasons why these sites are not yet delivering, for example developers needing to carry out site remediation or discharging complex pre-commencement conditions.

In summary, our analysis suggests that land with capacity for around 80,000-100,000 homes could be considered ‘unimplemented’. This is far below those figures suggested by other analysis, but may still be too high for a Government looking to increase housing delivery. As the Office of Fair Trading 2008 report showed, housebuilders’ approach to the land market is a consequence of the current system and they simply build homes at the rate they can sell them.

If Government is serious about increasing housing supply over the long term then it will need to look beyond the planning system and encourage greater activity from the full spectrum of potential housebuilders including SMEs, housing associations, local authorities, the wider construction industry, and Government.

^{Source: Savills Research using Glenigan}

Planning By Appeal

Our analysis shows 60% of refused residential developments (147 sites) were allowed on appeal in the year to March 2016. These add up to almost 27,000 homes, equivalent to over 10% of all permissions in this period. This is based on analysis of 244 planning appeals containing 50 or more homes.

We found that a lack of five-year housing land supply was the main reason for granting an appeal in 79 cases, totalling 15,000 homes.

A more general reference to the presumption in favour of sustainable development was mentioned in a majority of the remaining cases (56 out of 68).

For the 97 refused sites, containing 13,000 homes, the local authority being able to demonstrate a five-year land supply was cited as a reason to dismiss in only nine cases (1,500 homes).

The majority of sites (56%) were dismissed for “harm to the local area”, which covers environmental and amenity issues. A further 29% were dismissed for being “contrary to policy”, i.e. in conflict with local or neighbourhood plans, or specific spatial policies such as settlement boundaries or Green Gaps.

In a significant minority of cases an Inspector allowed an appeal, even though there was a valid five-year land supply. In some cases, Inspectors referred to the fact that housing targets are a minimum and achieving a specified target is not itself a barrier to further land release.

Overall, these results show the importance of local authorities having a robust and credible analysis of housing need, adopting it as an appropriate local target, and ensuring there is a sufficient and realistic five-year land supply to meet the target.

Without this, we will continue to see a significant number of decisions relating to local housing supply being made through the appeal process rather than as a function of local decision-making.

^{Source: Savills Research using Glenigan}