The Home Builders Federation (HBF) have recently published a survey report, Permission to land – debunking the land banking myth, that looks to discourage the popular accusation that Britain’s large home builders hoard land by obtaining planning permission for sites then choosing not to develop on them.

The survey found that the big house builders do not land bank in a methodical or concerted way. In fact very few sites (4% to be precise), which are viable and have planning permission but where work has not yet started, exist in the UK. HBF’s survey, which is based on 2,500 of their members’ sites, also found that 63% of plots were on sites where work on site had already started and that over a quarter of plots were on sites with only an outline consent, meaning that production could not legally begin.  

HBF look to previous independent reviews to give weight to their results. The Office of Fair Trading launched a wide-ranging study in 2008 which looked at the home building industry. They concluded that:

“we have not found any evidence to support the view that, at the national level, homebuilders are hoarding a large amount of land.”

In addition, Savills 2011 report on Strategic Development Sites found that commercial developers and social landlords owned the majority of sites during the early stages of planning. House building company involvement was concentrated at the construction stage, after outline planning had been achieved.

HBF believe that instead of debating over land banking or the existence of land banking, the debate needs to revolve around how to speed up the planning process in order to allow more homes to be built at a faster pace. They stress that the damning claims about land banking are frequently made in order to divert attention away from the “complex, bureaucratic, costly and time consuming” planning system (Stewart Baseley, Executive Chairman of the HBF, 2014).  

HBF’s opinion of the planning process is one that is given conviction by a Guardian article written recently by Paul Cheshire of the London School of Economics.  He comments that although housing completions have increased from the low levels of 2009, housing construction starts have fallen by nearly 10% (Gov.uk, 2014) and planning applications are flatlining.

Whether or not you are convinced by HBF’s land bank myth argument, unfortunately there is no disputing the current housing crisis Britain is facing. With an increasing number of people buying new-build homes through the ‘Help to Buy’ equity loan scheme, the facts are simple - homes need to be built and at a quicker rate than 110,000 a year (HMF, 2014). Perhaps, as the HMF and Paul Cheshire suggest, we should be focused on transforming the planning system into a less time consuming, less complicated process.