House prices have been artificially boosted by a lack of new stock and the time it takes to come onto the market, according to estate agent FPDSavills.
It says developers’ holdings of land with planning permission have fallen by almost a third (32%) since 1999, and fewer properties are being completed on an annual basis.
The research, conducted by the estate agent, welcomes the higher density of brownfield urban housing being allowed to compensate for the smaller greenfield land masses being given for development. However, it says these take longer to complete due to red tape and legislation.
Due to the extra administration involved in developing brownfield sites, Yolande Barnes, head of research for FPDSavills, said: ‘Ironically, the welcome move from greenfield may have made the supply shortage worse in the short to medium term.’
She added that this had fuelled the boom in prices: ‘If housing shortages are to be eased, then more land must be made available in the places where it is needed.’
Although the Government is aiming to ease the pressure through legislation such as its proposed Planning Bill, this may not be enough.
Barnes concluded: ‘The conventional approach to land release and development will not work. A new and more co-operative approach is needed to avert a crisis.’
Figures from the House Builders’ Federation point to future problems with the total number of houses completed in 2001 being just over 160,000. This is the lowest number for over 75 years.