Planning Reform Alone Cannot Solve the UK Housing Crisis

Propertymark, a leading industry body, has warned that reforms to the planning system will not be sufficient to meet the UK government’s target of building 1.5 million new homes by the end of this Parliament. While the planning system does require modernisation, Propertymark emphasises that the housing shortage is a complex issue demanding a more comprehensive approach.

The organisation’s Meeting UK House Demand position paper outlines recommendations for policymakers, including empowering local councils to build more homes and supporting smaller developers through planning processes.

Housing Demand and Social Housing Wait Times

Propertymark highlights the severity of the housing shortage, noting that over one million people remain on social housing waiting lists. In some parts of England, such as Westminster, families face waits of up to 107 years for a social home with three or more bedrooms. This acute shortage has pushed many towards the private rented sector (PRS).

However, the PRS is also under strain. Propertymark reports that due to limited supply and high demand, average rents across England have risen faster than real wage growth, placing additional financial pressure on tenants.

Why Planning Reform Is Not the Only Answer

Timothy Douglas, head of policy and campaigns at Propertymark, stated: “There is no doubt that the planning system needs reform, but it is not the sole reason the UK is failing to build enough homes. For decades, homes were delivered at scale under the same planning framework because local authorities were building, skills were available, and developments were incentivised to progress quickly.”

He added: “If we continue to treat planning reform as the single solution, we risk ignoring the wider structural problems that are holding back delivery. To genuinely meet housing demand, governments across the UK must take a more holistic approach that supports builders, councils, and communities alike.”

The Role of Councils in Increasing Housing Supply

Propertymark calls for local authorities to take a more active role in housebuilding. Historically, council-built homes accounted for 85% of new housing in 1951 but had fallen to just 0.06% by 2004. Although there has been some recent growth, councils were responsible for only 2.2% of new homes in 2023.

Increasing council housebuilding, especially of affordable homes, could relieve pressure on the private rented sector and help address the housing shortage more effectively.

Supporting Smaller Developers and Streamlining Planning

The position paper also recommends financial incentives and a streamlined planning process to encourage small and medium-sized enterprises (SMEs) to participate more fully in development projects. Propertymark suggests local authorities should implement clear, local schemes for planning delegation that benefit residents and accelerate decision-making.

Additionally, the organisation urges the government to launch a national recruitment and skills campaign to tackle the construction workforce shortage. It also recommends councils review stalled projects, with binding resolutions for major delays and referral of significant developments to the Secretary of State.

Implications for Landlords and Letting Agents

For landlords and letting agents, these findings underline the ongoing challenges in the housing market, particularly the rising demand and rental costs in the private rented sector. While planning reform may improve the pace of new developments, without increased council involvement and support for smaller developers, supply constraints are likely to persist, maintaining upward pressure on rents and limiting housing options for tenants.

Engagement with local planning consultations and awareness of council housing initiatives may become increasingly important for landlords and agents seeking to anticipate market changes.

Conclusion

Propertymark’s analysis makes clear that addressing the UK’s housing shortage requires more than just reforming planning laws. A coordinated approach involving councils, developers, and government support is essential to meet housing demand and ease pressures on the private rented sector.

Suggested internal link anchors

• UK housing shortage
• planning reform
• social housing waiting lists
• private rented sector
• council housebuilding
• affordable housing
• small and medium-sized developers
• construction skills shortage
• housing supply challenges
• rental cost trends

TLA update

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