The number of units granted planning permission in London across Q3, was the lowest in 17 quarters, stretching back to 2013. Following on from EG research looking at the national picture, we now take a closer look at the capital.
EG’s London Residential Research data reveals that the number of homes granted consent continues to fall, with the three-year rolling total, falling for the fourth consecutive quarter.
The decrease comes just a week after the mayor of London released ambitious new housing targets rising from the present figure of 42,000 to 66,000 homes pa. Just over 10,000 homes were granted consent in Q3 2017.
Commenting on the data, residential analyst Neal Hudson said: “It is clearly a challenging time in the London market. Turnover is falling, prices are growing more slowly or even falling in some markets, and new supply has been excessively focussed on top-end prices.
“That market has now weakened with questions remaining over the large number of homes due to complete in the next couple of years.
“Meanwhile, the uncertain political and economic backdrop makes it very difficult for businesses in all industries to make sensible and informed investment decisions. For landowners with no pressure to rush planning and development decisions the best option is to wait and see, irrespective of government targets.
Adam Challis, head of residential research at JLL added: “Strong improvements to the volume of planning permissions since 2012 have reversed. A range of factors are at play, notably the market slowdown and stamp duty, which is out of the mayor’s control.
“However, the mayor will need to be careful that ambitions in the housing strategy, notably on affordable housing, do not undermine this progress over the past five years.”
Not only are fewer homes coming through the planning system, what is coming through is being pushed further into the suburbs.
The two extremes in 2012 and 2016 follow the cyclical nature of the market, with just 16% of the planning consents in 2012 coming from Zones 4 to 6. However, and to show where the market is heading over the next year or two, the corresponding figure for consents within Zones 4 to 6 across 2016, was more than 50%.
A spokesman for the mayor of London said: “Planning consents across the capital are rising in the longer-term, but the challenge, as acknowledged by the chancellor in his recent Budget, is to ensure approved schemes are actually built.
“Through his draft London Housing Strategy and draft London Plan, the mayor has outlined his intention to intervene more in the capital’s land market to unlock stalled sites, to substantially boost development on small sites, and to set ambitious housing targets for all parts of the capital.
“The mayor is clear, however, that building the homes Londoners need will require significantly greater support from government, with London being given the powers and resources it needs to underpin a step-change in housing delivery.”
London Residential Research has mapped all schemes granted consent since 2015. The data within this research includes schemes granted consent at planning committee, or delegated decision level.
To access each individual building record, which has details on each scheme including site visit updates, developer details, and sales and pricing info (if it’s got to that stage yet), get in contact with Rob Mower on 020 7911 1431.
To send feedback e-mail paul.wellman@egi.co.uk or tweet @paulwellman eg or @estatesgazette
