While the trade body welcomed guidance from the National Housing and Planning Advice Unit (NHPAU) that up to 5% more homes will need to be built annually to meet supply, it warned the population will only take advantage of this if the private rental sector met demand for houses.
Stewart Lilly, chair of the planning, new homes and rural group for the NAEA, said the Government will end up relying on buy-to-let investors to provide property for rental and ensure that Britain has a roof over its head.
He commented: “But to make this happen, the buy-to-let market needs assistance from the banks and it will only be ministerial pressure that will make that happen. It is time for the Government to make those vast investments in the banks pay by exerting some pressure on lenders to free up the market from the heavy constraints it is labouring under.”
Lilly said the planning decisions by local authorities’ handicaps the supply of new homes.
In 2008 the number of new dwellings built was the lowest ever on record, and these planning decisions contribute to the stagnation of the economy, he said.
He added: “The planning policies of high density developments introduced by the Government are not working, and attempts to streamline the planning system have led to an increase in regulations for developers, and so more delays are occurring in these projects. Banks also need to start lending to developers again for such schemes to get off the ground. Until the Government and the banks face up to these challenges, the prospects for house building will not improve.”
