SME Homebuilders Call for End to Planning Uncertainty

DEPOLITICISING planning and offering more help for first-time buyers would speed up housebuilding according to SME developers’ comments in a recent study.

More than 90% of the 303 respondents cited planning permission delays as a major growth barrier in the Homebuilders Federation’s fourth annual State of Play survey.

SMEs would like to see local councils’ planning committees replaced by an independent body of trained planning experts with residents’ input at the local plan state.

Homebuilders Federation Executive Chairman, Stewart Baseley, said: “The debate around planning has become increasingly political over the last year.

“Policy uncertainty is causing further delays where local authorities are withdrawing or pausing local plan consultations. Only when SMEs do well can the housing supply we need be delivered.”

Call for End to Planning Uncertainty

SMEs said there should be more financial help for first-time buyers and that there should be a national review of the green belt.

They also called for more small sites in local plans with the process streamlined to make land available faster.

Additionally, respondents asked for housing delivery targets to be ‘mandatory’ again as an estimated 64 local councils have stalled on their local plans since the Government made them advisory in 2023.

Nine out of ten SMEs said that local planning authorities were under-resourced and 46% said planning permission costs had risen by more than 30%.

“SME housebuilders are particularly exposed to delays caused by under-resourced local authorities and the inefficient, embedded processes as they often don’t have the time or funds to navigate the system. If they aren’t building, they aren’t earning,” said Rowland Thomas, Managing Director of Close Brothers Property Finance which played a part in the study.

Respondents called for the threshold for affordable housing contributions to be raised from more than 10 dwellings to 50, and that they should be paid at the end of the project rather than the start.

Finance brokers Hank Zarihs Associates said development finance lenders were keen to support SME developers as they regarded them as an important element in innovation. The survey showed two-thirds were exceeding current regulations when it came to constructing sustainable homes.

“Too often the contribution that SME homebuilders make to our economy is overlooked, as is their role in helping to deliver high-quality homes that are tailored to the needs of local communities,” added James MacKenzie, Managing Director of Travis Perkins which was also involved in the study.

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