Investment in new housing sites has fallen to its lowest level in over a decade, according to the Home Builders Federation’s (HBF) latest Housing Pipeline report.
Between April and June 2025, just 44,520 new homes were granted planning permission – a 17% fall compared to the same period last year and the lowest quarterly figure since 2012. The number is also down by a third on the market’s recent peak.
The rolling annual figure stood at 221,900 homes, marking the weakest 12-month total since 2013. At site level, only 1,410 projects were approved during the latest quarter, the tenth consecutive quarterly decline. Over the full year, 8,200 sites were approved – fewer than half the number recorded in 2019, and the lowest since records began 20 years ago.
The slowdown highlights the challenges the government faces in delivering its pledge to build 1.5 million homes by 2029. To stay on track, an average of 370,000 permissions per year would be required, yet current levels are running at only 60% of that pace.
Neil Jefferson, chief executive of the HBF, warned that rising regulatory costs, lengthy planning delays and constrained access to finance are all compounding the issue.
He said: “A lack of affordable mortgage lending is suppressing demand for new homes, particularly amongst young people. Without government support for first-time buyers for the first time in decades, the potential market for new homes is being limited. This research highlights the fragility of the housing pipeline and a continued downward trajectory that shows little sign of changing soon.”
The data aligns with findings from the Construction Index published by Glenigan in September, which reported that residential construction starts fell 18% in August compared with the previous three months and were 16% lower than in 2024.
Private housing projects were down by 16% year-on-year, with Glenigan economist Drilon Baca commenting that contractors were frustrated by a “false start” in residential performance.
With housing permissions at their lowest in 12 years, analysts warn that supply levels are flatlining around 200,000 homes annually – well short of what is needed. Unless action is taken to speed up planning approvals, improve mortgage access and incentivise investment, the housing shortfall is likely to deepen, further stretching affordability for households and undermining growth ambitions.
