2020 Housing Delivery Data – The Heatmap

25th January 2021

The Government has released housing delivery data for 2020.

Some authorities are doing better. Some are doing worse.

And a new change could benefit developers.

Let’s take a look:

 

(Click here to view fullscreen in a new window)

 

Covid – the elephant in the room

Of course, 2020 wasn’t a normal year. When the first lockdown hit in March 2020, many construction projects were paused, having a knock-on effect on housebuilding.

However, the Housing Delivery Test runs from 1st April to 31st March. So this data release would have stopped collecting data just a fortnight after lockdown came into effect. 

We’ll need to wait until next year for a clearer picture of how Covid affected housebuilding.

But Covid did have one impact on this data. Because of the difficulties with collecting the data,   the Government reduced the housing targets on local authorities by a month. (You can read more about that here). 

So while we aren’t seeing the full impact in the data, the pandemic is still having a knock-on effect (as it has for a lot of things this year).

 

The state of housebuilding in 2020

Overall the picture for new houses has improved.

In 2020, English local authorities were asked to deliver 207,000 new homes, and they delivered more than 251,000 – 121% of the target.

The Ministry of Housing, Communities & Local Government have said that 2019 to 2020 saw the biggest increase in new homes in over 30 years (looking at Housing supply figures). 

The Housing Delivery Test data seems to support this. In 2019 English authorities were at 109% of their target. Authorities delivered 4000 more homes in 2020 than in 2019.

But with all this, it still falls around 49,000 homes short of the much-discussed target of 300,000 new homes a year.

There’s still some work to do.

 

Five Key Insights

  • We’ve got more housing. But is it enough?

Each local authority has a unique housing target, based on household projections and housing need. 

On average in 2020, authorities were overperforming at 138% of their individual targets, rising from 117% in 2019, and 112% in 2018. 

However, a third of authorities were under 95% of their targets. 

Why is this the case? 

Are overperforming authorities less strict with their planning rules? Or do they have low requirements? Are there infrastructure challenges that the council hasn’t addressed?

Questions to consider. Questions which could prove profitable for developers. 

 

  • Are those houses in the right areas?

England might be building more houses but, from the heatmap, it’s clear that new housing is still falling short in the areas where people want to live the most (and where prices are highest).

Since 2018 Kent and the London commuter belt have become increasingly red on the heatmap. For instance, authorities such as Gravesham, Medway, and Sevenoaks are falling well short of their housing targets.

 

2018 Measurement

2019 Measurement

2020 Measurement

Gravesham

64%

75%

70%

Medway

47%

46%

55%

Sevenoaks

94%

71%

70%

But regionally, the North is still continuing to overdeliver – with Northumberland, Carlisle, and Eden all above 250% of their targets, and rising from previous years. 

With the pandemic and remote working, could this change? 

Will housing targets change as people realise they don’t need to be as close to London for work? Will we see an exodus from urban areas? And will developers serve that demand?

 

  • Here are the local authorities most overdelivering on their targets

Local Authority

2018 Measurement

2019 Measurement

2020 Measurement

Richmondshire

410%

863%

2113%

Copeland

242%

351%

692%

Burnley

388%

405%

392%

Redcar and Cleveland

292%

379%

389%

Cheshire West and Chester

365%

382%

383%

Tamworth

86%

169%

340%

Darlington

182%

241%

340%

Preston

252%

313%

339%

Knowsley

182%

250%

339%

Allerdale

278%

304%

328%

 

  • Here are the local authorities falling furthest short of their targets

Local Authority

2018 Measurement

2019 Measurement

2020 Measurement

Eastbourne

73%

38%

29%

Epsom and Ewell

57%

49%

34%

Havering

49%

33%

36%

North Hertfordshire

55%

44%

36%

Southend-on-Sea

49%

52%

36%

Basildon

75%

44%

45%

Adur

41%

56%

48%

Castle Point

48%

54%

48%

Watford

108%

70%

48%

Epping Forest

49%

50%

49%

 

  • The consequences are harsher for those LAs not hitting their targets

In 2019 a new consequence was introduced to the Housing Delivery Test – “presumption in favour of sustainable development”. The cutoff for this consequence has been raised, which will shake up planning departments across the country. 

Of the 323 local authorities in the data, 216 (67%) have met their targets and will face no consequence. But according to paragraph 215 of the National Policy Planning Framework (NPPF), authorities face the following consequences if they aren’t building enough housing:

 

If they are under 95% of their target – 

Authorities have to come up with an action plan detailing why they're under-delivering, explore ways to reduce the risk of further under-delivery, and also set out measures on how they'll improve delivery.

This applies to 33 authorities (10%).

 

If they are under 85% of their target –

Authorities have to produce an action plan and provide a 20% buffer to the 5-year land supply they've allocated towards housing.

This applies to 19 authorities (6%).

 

If they are under 75% of their targets –

Authorities have to provide an action plan, provide the buffer, and then "application of the presumption in favour of sustainable development” will apply.

This affects 55 authorities (17%) – a big jump from the 8 authorities last year. That’s because the cutoff rose from 45% of target to the current level of 75%.

Last year it was unknown territory what this meant for developers. But now, there’s a bit more clarity on what it could mean. 

For instance, near the start of 2021, a redevelopment providing 103 homes in Redbridge was given the green light, despite receiving 144 objections to the plans. Why? Because Redbrige is now subject to the “presumption in favour of sustainable development” as outlined in the planners recommendations. 

 

"While the test is not a complete open gate for new development, it can often mean councils are in a far more precarious position to refuse housing development in the context of under delivery.

The Councils that are in the most precarious position are those that are failing on both delivery and housing land supply (a separate measure). Recent appeal decisions, including one in Uttlesford, have been pretty scathing stating the local plan was ‘not a strong foundation upon which to refuse planning permission.”

Peter Higginbottom

Managing Director at Planning Insight

 

 

We still need new housing

This is the third year the Housing Delivery Test has been running, and overall the country is getting better at delivering houses. Despite that, a third of authorities are not hitting their targets, and many of these are in the South East. 

“Presumption in favour of sustainable development” now applies to 55 authorities, often in areas where there is a desperate need for new houses, with prices reflecting this. There might be opportunities in this for fast-moving developers.

And while this is the data up until 31st March 2020 (so we can’t see the full impact of Covid), it is probably safe to assume that the current situation won’t have drastically improved things on the housebuilding front.

Still, there are lots of ways that developers can start building more houses to help lift those housing-deliver numbers.In particular the 2020 changes to Permitted Development offer some pretty big opportunities.

 

Want to know where to get started?

Check out our guide on Permitted Development Guide

 

David is LandTech’s resident Data Journalist. He has a degree in Physics, but he went all in on the spreadsheets after giving up on his dream to be an astronaut. He once made £150 from an initial investment of £20 selling… apples.