Planning permissions accepted in wrong areas, says Savills
According to new research by Estate Agents Savills, planning permissions accepted for new homes are being concentrated in the wrong areas, where there is less need for housing.
The research found that there is a lack of 90,000 planning consents for homes in the least affordable and most in-demand areas of the country.
Only 20% of planning consents in 2016 were in the most unaffordable places, where the lowest priced homes are at least 11.4 times income. However, 40% of the country’s total need for new homes is in these markets, while there is a surplus of consents in the most affordable locations.
Savils found that in areas where the house price to earnings ratio is over 11.4, which includes London and much of the South East, there is a shortfall of 73,000 planning consents for homes.
The analysis shows that there has not been any increase in the areas where affordability is most stretched and where housing need is the greatest.
The Savills report said: “This means we are not building enough homes in areas where they are most needed to improve affordability and support economic productivity.”
Only 41% of local authorities have a housing plan, which sets out housing need and a five-year plan of how to cater for it.
Chris Buckle, research director at Savills, said: “There continues to be a massive shortfall in London and its surrounds and it is this misalignment of housing need versus delivery which could ultimately hinder economic growth.”