Is the UK Housing Delivery Doomed in 2020?

by Alia Khan, Consultant

A recent analysis conducted by the global property consultancy Knight Frank, suggested that the knock-on effects of the  coronavirus  will result in 56,000 fewer homes being delivered in the UK this year, a 35 per cent drop. The analysis indicates that, ‘private housing delivery across the UK will be lower than in the years following the global financial crisis.’

Others, such as Savills, also see a fall in both housing delivery and sales this year as being inevitable but remain optimistic that the coronavirus-related disruptions will be relatively short-lived. A number of big developers, including Redrow, Persimmon and Taylor Wimpey, are already reopening their construction sites which seems to suggest that this is a correct assumption.

While sales and new build construction may be slow to come back to pre-pandemic levels, we could see housebuilders take other paths such as increased affordable housing delivery, as was observed in the aftermath of the global financial crisis. Savills predicts that ‘there will also be continued demand from institutional Build to Rent investors, albeit they may require greater discounts to account for difficulty letting in the coming months.’

To ensure development continues, MHCLG issued directions early in the pandemic lockdown that planning and plan making processes must continue. A little while later, the Government passed legislation to allow councils to hold meetings without councillors being physically present – councils around the country are now implementing virtual meetings to enable planning to continue. Some councils have reported  an increase in the number of applications coming in during the lockdown. Many are of a view that remote working measures might have a positive impact on the notoriously slow planning process.

We at Chelgate Local have been holding a number of Live Planning Events with council leaders and portfolio holders who are embracing the new digital ways of working and see it as an essential part of the nation’s economic recovery post-pandemic.

Although the emerging data from the sector suggests a decline in the housing delivery for the year, there have been a number of positive signs emerging. The industry and society are quickly adapting to our new reality and with planning continuing and construction sites reopening, perhaps not all hope is lost for housing delivery this year.