Planning Permission Applications Down Once Again in Q1 2022

The lack of inventory in the UK’s prohibitively expensive housing market shows no signs of abating soon. According to the most recent figures published by the Department for Levelling Up, Housing, and Communities (DLUHC), just 84,000 of the 109,900 applications for planning permission submitted in Q1 this year were granted.

This equates to an 87% success rate for planning permission applications submitted during this time—down 4% compared to Q1 2021. This may sound less than significant, but it comes at a time when the UK is in dire need of a major uptick in affordable home availability.

In addition, the total number of planning permission applications received for the quarter was down 12% compared to the previous quarter.

A total of 9,300 residential planning permission applications were granted in England in the first three months of the year, a 6% decrease compared to the same time last year. 1,900 commercial planning permission applications were granted. Down 2% from Q1 2021.

Affordable inventory is urgently required

The dire need for rapid acceleration in the housebuilding sector was highlighted by Paul Neal of Missing Element Mortgage Services, who emphasised the importance of focusing on the availability of homes for people who actually plan to live in them.

“Not stock that is snapped up by landlords or builders to make a fortune on. Reliable, affordable housing for everyday people,” he said.

“Sadly, it’s not coming at anywhere near the pace it needs to, and planning is often the issue.”

Speaking on behalf of London-based property developer New Place, managing director Joe Garner said that the DLUHC data provides a clear indication that nowhere near enough homes are being built in the right places.

“The planning system is an absolute mess, and political infighting from central government all the way down to local councils is perpetuating the housing crisis,” he said.

Garner’s sentiments were echoed by Jamie Lennox, director at Norwich-based mortgage broker Dimora Mortgages, who likewise said that the government is not even coming close to meeting its own house-building targets.

“Many developments get stuck in planning for years, and until there is a quicker process to get sites approved, the ambitious plans for a certain number of new homes won’t ever materialise,” he said.

Help to build push continues

Meanwhile, the government continues to push its Help to Build scheme as a potentially affordable alternative access point to the UK housing market.

Help to Build provides those looking to build their own homes with the opportunity to access a special mortgage of up to £600,000, which can be secured with a deposit of just 5% and offers the first five years interest-free. This 95% LTV mortgage will only be available through a selection of approved lenders, and the scheme is being managed by Homes England.

“Through the Help to Build scheme, we will help thousands more people onto the property ladder by giving them the opportunity to build homes that are perfectly tailored to their needs and in the communities they want to live in,” said Housing Minister Rt Hon Stuart Andrew.

“This innovative scheme will build on our work to break down the barriers to homeownership, as well as create new jobs, support the construction industry, and kickstart a self- and custom-build revolution.”

Open to movers and first-time buyers alike, Help to Buy combines low initial deposit requirements with five interest-free years, followed by a 1.75% APR in the sixth year and incremental annual increases thereafter.

“Self-build isn’t the preserve of the wealthy, and Help to Build makes it more practical and accessible than ever before for people to build their dream home,” said Andrew Craddock, Darlington Building Society chief executive.

“This scheme also opens up opportunities for first-time buyers. It is a fantastic example of the market moving with the times and people’s changing wants and needs.”