Steve Larkin

Small developers rely on government to get serious about releasing land




Access to land remains at the forefront of the problems faced by small developers when it comes to delivering more homes.

These small developers, therefore, continue to operate at a significant disadvantage when it comes to getting hold of land on which to produce homes compared with their larger rivals.
It’s something that the government has acknowledged, and looked to address through its release of public sector land for housing development. However, it appears that there is plenty of work to do on that front.

Behind schedule

A recent study from the National Audit Office (NAO) looks at how the government is progressing against its targets for releasing that public sector land for housing, and it makes for concerning reading.

The government had set itself a target of releasing enough public sector land in order to build 160,000 homes by 2020, yet according to the Ministry of Housing, Communities and Local Government (MHCLG) departments are likely to have released enough land for just 65,000 homes by that point.

That’s just 41% of the promised land, with the department suggesting it may take until 2025 to hit that target. Looking back to the public sector land released since the initial programme between 2011 and 2015, the NAO found that against the original target of enough land for 100,000 homes, just 40,500 have been brought to market.

What’s holding them back?

The MHCLG has pinpointed a host of challenges which are impeding them from releasing more public sector land quickly.

For example, in some cases public bodies are still actually using the land and so it can’t be released until they are relocated. Sales of large, more complex sites have been delayed too as a result of issues with planning, while some sites need to be decontaminated before they can be released for housebuilding purposes.

However, the NAO pointedly notes that the MHCLG did not provide any data on how many sites have fallen into each of these categories.

Is it all about the money?

While the government is significantly behind target when it comes to the amount of land being released, there are no such issues on the money it’s looking to raise from these sales.

The government wanted to bring in £5bn by releasing this land when it introduced its target, and it claims to be on course to do just that. Two transactions have raised more than £1.8bn already, with £2.48bn generated up to March last year. Of the 1,500 sites sold up to that point, more than one in 10 (12%) were sold for £1 or less.

Talking a good game isn’t enough

The government has generated support among the property industry precisely because it has acknowledged the systemic issues holding back increasing the rate at which we build homes, and identifying ways to address those issues.

But talking the talk isn’t enough. That the government is so far behind on its target for land release is hugely disappointing. Small developers are crying out for opportunities to pick up land that is ordinarily out of their reach, and to get moving on producing the homes that this nation desperately needs.

This isn’t an issue that can be kicked down the road, to be addressed at a later date. This land could make a huge difference to the nation’s small developers and would-be homeowners alike, and it is imperative that the government grasps this opportunity. It’s time to get serious.

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