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Letwin plays dodgeball on housing build out rates

Letwin plays dodgeball on housing build out rates

Richard C | 29 June 2018

Sir Oliver Letwin’s preliminary statement dodges the only areas where government can make a difference.

In what some are describing as a bold statement, Letwin’s review of housing build-out rates has confirmed that land banking is not happening and that the snail’s pace responsiveness evident in infrastructure provision is not the issue. He will not entertain any review of the town planning process - it seems he has drawn the boundaries of his review to exclude this rather pivotal part of the overall process.

Instead, Letwin is laying the solution entirely at the door of the housebuilders. Really?

Effectively, Letwin is suggesting that housebuilders need to understand their market better and plan to provide a broader range of product to improve market absorption. Whereas this may be the case for a few new entrants to the market, it seems a little naïve to suggest that established volume housebuilders don’t know their business - and would be willing to prejudice their bottom line to absorb the costs of the factors that are outside of their control (and which Letwin is choosing to ignore).

For his recommendations, due out in the Autumn, Letwin may be better considering whether and how to improve the areas of uncertainty outside the control of our hard bitten and naturally nervous housebuilders – e.g. more predictable and streamlined planning outcomes and short cuts to the antediluvian infrastructure provision processes. Industry polls like our recent LDB have shown that improving town planning policies is considered key to enabling development. Consultations will undoubtedly tell him that this would lead to more reliable long term business planning which will help to make diversity of product and faster absorption a viable proposition.

The 15 ½ year average site build out rate quoted is clearly abysmal but it won’t be improved if the government chooses to dodge the issue.