What Do Labour’s Housebuilding Plans Mean for the Industry?
Since long before their landslide victory in the 2024 General Election, Keir Starmer has been outlining his ‘housing recovery plan’ that would aim to see 1.5 million new homes built across the UK.
The ambitious plan seeks to reform the planning process, create the next generation of ‘new towns,’ and hand more construction authority to local leaders. The pledges made in the Labour manifesto to ‘save the dream of homeowning’ could be underway very soon.
But what do these housebuilding plans mean for the industry at large? In this article, we’ll take a look at the details of Labour’s plans and how they might impact the housebuilding sector in the UK.
How Planning Reform Will Impact the Housebuilding Sector
Planning reform was absolutely central to Labour’s offer throughout their General Election Campaign. Shadow Chancellor Rachel Reeves stuck to Labour’s promises of “making a start on this on day one,” announcing a series of planning reforms almost immediately after Labour’s victory. So, what might this look like for the housebuilding sector in the UK?
Labour will aim to amend the National Planning Policy Framework
The result will be that specific types of investments would be prioritised in order to boost the UK economy, and this will likely include the projected 300,000 houses per year that the Labour government plans to build.
The slow pace of the planning system is a factor which, according to the legal experts at Travers Smith, “currently inhibits the speed of delivery.” This is something that Reeves echoed, describing current planning processes as “a barrier to growth.”
In short, this should make gaining approval for vital housebuilding projects much more straightforward across the construction industry.
Labour is also set to reintroduce mandatory housing targets.
Championed by Reeves, this pledge would see a rehabilitation of the mandatory local housing targets that were discontinued in 2022. Reeves argues that this was not met in previous years and became an optional goal rather than a mandatory requirement for the net construction of homes. This could result in increased demand for construction services within the housebuilding sector as more local authorities strive to meet the targets.
Balancing Decision-Making with Local Communities
A core element of Labour’s housing policy is bringing decisions closer to local communities. However, balancing this with the wishes of local people isn’t always straightforward. Starmer and his cabinet are attempting to strike this balance by devolving powers to local authorities while simultaneously implementing ‘Local Growth Plans.’
Local Growth Plans will introduce a statutory requirement for town regeneration schemes to include key infrastructure, utility, and housing requirements such as affordable homes, road improvements, and GP offices.
The third element of this move towards more local decision-making is to support local authorities by funding additional planning officers and ensuring that the authorities have up-to-date local plans, too.
This carrot-and-stick approach of increasing local powers while introducing statutory requirements could breed the perfect environment for the housebuilding sector as local leaders will be given both the means and the necessity to increase housing numbers.
The ‘Planning Passport’ For Urban Brownfield Development
As many readers will know, urban brownfield land is essentially land in urban areas that have been built in the past. In the past, Starmer proposed the notion of ‘planning passports’ to encourage development on these sites.
What is a planning passport?
In essence, developments on urban brownfield sites would receive fast-track approval and feature high-density housing, which would subsequently be prioritised for first-time buyers. The aim here is to create safe, durable, and affordable housing that supports people in getting onto the property ladder.
What does it mean for the construction industry?
This could see housebuilding become a much more straightforward process for construction companies and the local authorities that engage them. With clear backing from the national government and a streamlined approach to urban brownfield development, we could see a rapid increase in the speed of new housing projects in these areas.
What Is the Overall Impact of the General Election on the Housebuilding Sector?
In general, the outlook for the housebuilding sector is positive. Labour has positioned itself firmly in favour of resolving the UK housing crisis with its target of 300,000 new houses per year while also introducing practical, pragmatic planning reforms to make this achievable. If there is a challenge, it will be in balancing the wishes of local communities with the desperate need for new, affordable housing. This is something that Labour’s legislative and statutory requirements aim to resolve.
Are You Prepared for the Changes Ahead?
Whether you’re a contractor, developer, or construction professional, staying ahead in this evolving landscape is crucial. Since 1973, ITS Building People has been the specialist recruitment partner for the UK’s construction industry. Don’t miss out on the opportunities offered by the new government’s housing reforms.
Partner with us today to secure the best talent and navigate the new landscape with confidence by getting in touch with our team.
