BLOGS

A five-year slide in approvals

England's planning system has been quietly losing momentum for half a decade, and the latest data confirms the trend has now reached a new low. REalyse planning application data shows that granted residential units peaked at just over 500,000 in 2019, before falling in almost every year since — dropping to roughly 267,000 in 2024, close to half the 2019 figure.

The number of applications submitted tells the same story. Applications for residential-led schemes peaked at over 31,000 in 2018 and had fallen to around 13,000 by 2024 — a drop of more than 55%. Early figures for 2025 suggest the decline is continuing, though it's worth noting that recent-year totals will rise somewhat as more applications work through the decision pipeline; planning decisions can take months or years to finalise, so the most recent 12–18 months of data understate the eventual outcome.

Even allowing for that lag, the multi-year direction of travel is unambiguous. This isn't a blip caused by one bad quarter — it's a sustained retreat in both the volume of schemes coming forward and the willingness or capacity of local authorities to approve them.

Why approvals are falling

Several forces appear to be compounding each other. Higher interest rates and construction costs since 2022 have squeezed development viability, particularly for smaller and mid-sized housebuilders who account for a large share of applications outside the major national builders. When a scheme's numbers don't stack up, it's often shelved before it ever reaches a planning committee — which shows up in the data as fewer submissions, not just fewer approvals.

On the supply side of decision-making, local planning authority resourcing has been under strain for years, with case officer numbers failing to keep pace with the complexity of applications — particularly since biodiversity net gain, nutrient neutrality rules, and building safety requirements added new evidentiary hurdles for developers. Nutrient neutrality alone has stalled thousands of consents across the South West, East Anglia and parts of the North.

Political caution at the local level is also a factor. With councils facing local pushback on density and character, and five-year land supply calculations increasingly contested, discretionary approvals — particularly for larger schemes — have become harder to secure without appeal.

What it means for the government's housing target

The government's ambition of 1.5 million new homes over the current parliament — roughly 300,000 a year — was already viewed by most industry commentators as stretching, even before this data. A granted-units run rate closer to 200,000–270,000 a year implies a persistent shortfall against that target, assuming historical conversion rates from consent to completion hold (typically well under 100%, given lapsed permissions, phasing and viability re-tests).

For investors and lenders, the practical implication is a tightening pipeline of investable stock in the medium term. Fewer approvals today means fewer completions in two to four years' time — which, all else equal, supports the case for continued rental and capital value growth in undersupplied markets. REalyse comparables data across build-to-rent and single-family housing schemes already shows rental growth outpacing long-run averages in several regional cities where consented pipeline has thinned most.

For developers, the calculus shifts toward sites with existing consent or those furthest through the process — de-risking acquisition strategy in favour of paying a premium for certainty over optionality. Land with resolution to grant, or shovel-ready sites with discharged conditions, are likely to command a growing premium relative to raw or unconsented land as the approvals bottleneck persists.

Outlook

Government reforms — including changes to the National Planning Policy Framework, mandatory housing targets for councils, and streamlined nutrient neutrality rules — are intended to unblock this pipeline. Whether they translate into a meaningful uptick in granted units will likely take 12–24 months to show up clearly in the data, given typical application-to-decision timelines.

Until then, institutional investors, lenders and developers underwriting UK residential exposure should treat planning risk as a first-order variable in site selection and portfolio construction — not a secondary consideration behind price and location alone. Monitoring granted-unit volumes by region and local authority, rather than headline national figures, will be the more reliable early indicator of where the target is likely to be met — and where it isn't.