Unpicking government housing plans

A year after the General Election, GB looks at if the government are on track to build their promised 1.5 million homes by 2029

The Labour government’s Spending Review, delivered by the chancellor Rachel Reeves before the House of Commons last month, unveiled a huge £39 billion for social housing between 2026 and 2036.

This follows a Spring Statement in March that showcased the Office for Budget Responsibility’s (OBR) conclusion that the government’s planning reforms would permanently increase the level of real GDP by 0.2 per cent in 2029-30, a £6.8 billion boost for the economy.

Additionally, due to Labour’s new National Planning Policy Framework (NPPF), the OBR estimated that annual housebuilding is to increase by around 30 per cent by 2029, taking net additions to a 40-year high.

These numbers sound promising, but what does this mean in real terms? And what about Labour’s manifesto commitment to building 1.5 million houses – are we on track to hit that target?

“Get Britain building again"

In Labour’s 2024 manifesto, Keir Starmer promised to “get Britain building again” with his mission to build 1.5 million homes by the end of Parliament. But what does that mean?

The UK government uses two sets of statistics to describe how many homes are being built: net additional dwellings, and indicators of new supply. Net addition dwellings show housing supply, or how many homes have been created; this figure includes new build properties, conversions (a house converted into flats), and changes of use (an office building becoming a home). Indicators of supply describes new houses being started and completed. This means that one new build house to be rented as three flats would log as three extra net addition dwellings, but one more indicator of supply.

1.5 million new homes

In summer 2024, Labour confirmed it was aiming to build 1.5 million new net dwellings in England by August 2029. This is a huge ramp up from the previous government’s targets: 300,000 new homes a year and one million new homes over the whole Parliament.

In their Manifesto, Labour laid out how they intended to do this, and pledged to immediately update the NPPF, hold local authorities to account, and support them with adequate guidance and financing.

A key component in their housebuilding strategy focuses on a brownfield first approach, which means that proposals to build on previously industrial land will be prioritised, in a movement to preserve greenbelt land. Labour is also willing to release lower quality ‘grey belt’ land for development, which is lower quality greenbelt land, and land on the edge of existing settlements, roads, or car parks.66

Net additional dwellings reached a recent peak of 223,530 in 2007-08, which decreased until an uptick in 2014. In 2021-22, 232,820 net additional dwellings were added to England’s housing supply, with 210,070 of these being new build homes. Most recent figures, from 2023-24, show that housing supply in England amounted to 221,070 net additional dwellings, with 198,610 of these being new build homes.

Housebuilding has been relatively stagnant since 2019 and we are far from having enough for a growing, and aging, population. In 2024, there were 1.3 million households just on 
social housing waiting lists, and a record number of people in temporary accommodation, including 150,000 children. 

A report by Centre for Cities found that Britain has a backlog of 4.3 million homes that were never built.

If the government wishes to have 1.5 million new homes in England by August 2029, they will need to acquire 300,000 net additional dwellings each year, though they have set 370,000 as their yearly target. The last time the government met 300,000 homes was 1969.

A 2024 analysis from the Financial Times, using migration projections for 2023-36, estimated that England would need 421,000 new homes per year, potentially up to 529,000 per year if current net migration levels hold. Were the government to build only 300,000 homes each year, it would take at least half a century to plug the housing deficit.

Labour’s first 100 days in power

Starmer started his premiership with plans to build new towns across the country, each one to have at least 10,000 homes and governed by a New Towns Code: a set of rules that developers would need to meet to ensure all towns are well-connected, well designed, and sustainable. 40 per cent of these must be affordable.

In July, all English councils were given new, mandatory housing targets to hold them accountable, and the government ensured that the default answer to brownfield development should be ‘yes’. Councils were also told to review the amount of greenbelt land needed to meet their housing targets, as well as identifying ‘grey belt’ land, including lower quality greenbelt land, and land on the edge of existing settlements or roads.

Land released from the greenbelt must now follow the government’s so-called ‘golden rules’; that is, 50 per cent of these homes must be affordable, there should be increased access to green spaces, and necessary infrastructure must be in place, like GP surgeries and schools. Releasing greenbelt land, however, has not been without controversy from environmental charities and organisations.

Announced early on into the Labour government and launched at the end of August, the New Homes Accelerator is a partner to the New Towns Taskforce, and is a collaboration between the government, Homes England, the Greater London Authority, local authorities, and developers. Aiming to unblock and accelerate housing developments, the New Homes Accelerator focuses on unblocking delayed large-scale developments. The government has estimated that there might be up to 300,000 homes to be unlocked within these sites.

More private-public investment will be channelled into housebuilding: the government announced in October that £550 million had been secured to get Britain building again, as well as a £76.8 billion impact investment fund that will deliver tens of thousands of new homes.

As part of unlocking development on brownfield sites, the government announced £68 million for 54 councils, delivered through the Brownfield Land Release Fund, to enable councils to prepare the land for development and transform abandoned sites. This should mean that 5,200 homes will be able to be built nationwide, with £2.9 million for Manchester, £2.2 million for Eastbourne, and £1.4 million for Northampton, among many other recipients.

The Autumn Budget

By the time of the Autumn Budget, the government had already launched their National Policy Framework consultation, and aimed to confirm the new planning system by the end of the year.

The Autumn Budget also saw a mass announcement of finance allocations to boost housebuilding, with money flowing into a variety of different initiatives. £500 million was added to the Affordable Homes Programme to build up to 5,000 more affordable homes and taking its 2025 budget up to £3.1 billion, £46 million went towards local planning authorities to increase capacity, and £70 million will be allocated in 2025-26 to support infrastructure and housing development while boosting nature’s recovery.

The government pledged £10 million for the Oxford-Cambridge growth corridor to boost an ambitious plan for housing, transport, and infrastructure between the two cities, £3 billion in additional support for SMEs and the build sector to support the private housebuilding market, £45 million to recruit and train 300 graduates and apprentices into local planning authorities, and £56 million for 2,000 new homes at Liverpool Central Docks.

The National Planning Policy Framework (NPPF)

First published in 2012, the NPPF sets out government planning policies in England and is updated regularly to reflect a government’s planning policies. It was last updated by the Sunak government in December 2023 when, among other changes, housing targets were made advisory as opposed to mandatory.

In December 2024, the government published a new NPPF, which included mandatory housing targets, different for each area.

The new NPPF also designates some greenbelt land as grey belt which is described as: “land in the Green Belt comprising previously developed land and/or any other land that, in either case, does not strongly contribute” to the purposes of Green Belt land: reducing urban sprawl, preventing neighbouring towns from merging, safeguarding the countryside from encroachment, assisting in urban regeneration and preserving the setting and character of historic towns.

Releasing grey belt land could have benefits for London: in 2022, around 47.7 per cent of greenbelt land is characterised as developed. Now, this land has the potential for housing and infrastructure development.

Planning and Infrastructure Bill

Currently in the committee stage in the House of Lords, the Planning and Infrastructure Bill introduces changes to legislation that will make housing and infrastructure development easier, as well as reforming planning authorities and speeding up decision making in the planning process, though not without risk.

Currently, infrastructure projects can be legally challenged three times, but the new Bill would reduce the number of opportunities a project can legally be challenged to just two, and only one for those judged ‘totally without merit’.

Planning approvals are at their all-time lowest since 1979, and reviving planning committees is at the heart at having more projects approved. Underfinanced, understaffed, and without power and capacity to approve their workload within statutory timelines, planning committees need help should the government wish to push more projects through the system and be approved.

Under the Bill, the government will have more power to intervene with planning decisions and could introduce regulations that allow them to control which planning decisions will be issued to which officers (bypassing them going to local planning committees), speeding up the flow at which projects move through the system.

Government partnerships

To bolster development, the government has made a significant effort to form partnerships, both with private developers and local authorities.

A 12-year joint venture, named HABIKO, from Pension Insurance Corporation, Muse and Homes England have pooled £54 million to bring forward 3,000 low carbon, low energy homes for rent. All these homes are intended to be affordable, with rents to be set 20 per cent below the local market rent.

Homes England has additionally collaborated with numerous councils across England. Sunderland City Council and Homes England have agreed a funding package of £28.75 million to support the delivery of critical infrastructure, on top of previously-agreed council funding of £49.94 million, which aims to create around 1,000 homes, as well as other community infrastructure projects.

Social and affordable housing

In December, it was announced that the Affordable Homes Programme would see a £300 million boost, enough to build 2,800 homes, half of these being social ones. Affordable homes are priced up to 80 per cent of the market rate, while social rent is much lower and is based on a government formula.

The £11.4 billion Affordable Homes Programme 2021-26 was expected to deliver 180,000 new homes, with half of these at discounted rent (including social rent) and 50 per cent affordable home ownership.

Later, in March, a £20 million package was confirmed for community groups, such as community trusts and housing co-operatives, which is to support construction of more than 2,500 new social and affordable homes over the next decade.

Reeves’ Spending Review promised £39 billion for social and affordable housing between 2026 and 2036, averaging at £3.9 billion each year over the period compared to the current £2.3 billion, which takes funding out of austerity levels.

In Shelter’s report on social housing, Brick by Brick: A Plan to Deliver the Social Homes we Need, they explain that England has seen a net loss of 260,000 social rent homes within the last decade, and that in order to address England’s astronomical shortage of genuinely affordable homes, 90,000 would need to be built every year for a decade.

Four years left to go

Numbers of new home completions, calculated using Energy Performance Certificate (PC) data in 2024 fall short at 217,911, which is the lowest number of new homes built over a 12-month period since 2017, not including the Covid years. Importantly, last year was split down the middle by two governments, and a major overhaul of the planning system occupied most of Labour’s autumn, so is not necessary a precedent that will be followed for the upcoming years.

New build dwelling stats in England are estimated at 28,180 in 2025 Q1 (1st January 2025 to 31st March 2025), which although a nine per cent decrease when compared to 2024 Q4, is a 22 per cent increase when compared to the same period in 2024. This is hugely promising that new builds will continue to rise as planning permission is attained more easily throughout 2025 and the rest of the government’s tenure.