BLOGS

A pipeline that looks healthier than it is

England's planning system is processing more housing ambition than it has seen in years. Planning Portal data shows applications were lodged for over 335,000 new homes across England in 2025, the strongest year since 2020, with the final quarter alone up 61% year-on-year. Momentum has carried into 2026, with 12-month application volumes clearing the 400,000 mark for the first time since 2022.

On paper, this is exactly the outcome the revised National Planning Policy Framework and Planning and Infrastructure Act were designed to produce. Mandatory local housing targets, the release of "grey belt" land, and streamlined committee processes have visibly shifted developer behaviour. The average number of homes per application has nearly doubled in little over two years, pointing to larger, more strategic sites coming forward rather than a scatter of small infill schemes.

But a four-year high in applications is not the same as a four-year high in homes being built. The gap between what is submitted and what is actually delivered is the real story of this reform cycle — and it is the variable that matters most to anyone underwriting UK residential exposure right now.

Applications up, delivery still stuck near a decade low

The delivery-side numbers tell a much more sober story than the applications headline suggests. Housing starts across England totalled only around 150,000 in 2025 — some way below the level of intent now moving through the planning system — while completions have fallen to their lowest level since the mid-2010s, with several data series putting 2025-26 completions somewhere in the 140,000-150,000 range, well short of the roughly 300,000-a-year run-rate implied by the government's 1.5 million homes target.

The Home Builders Federation's own pipeline analysis, compiled with Glenigan, recorded 11 consecutive quarterly declines in permissioned sites before the recent recovery, while major schemes now take over 300 days on average to secure a decision — a rise of roughly 75% over the past decade. Only around one in five major applications is currently determined within the statutory 13-week window.

REalyse's planning pipeline data points to the same structural issue from a different angle: the average lag between permission granted and construction start has lengthened across most English regions over the past two years — the opposite of what reform is meant to achieve. For institutional lenders and developers, that lag is the critical underwriting variable. A scheme with consent today may not break ground for 18-24 months, and viability inputs — build costs, interest rates, Section 106 and infrastructure obligations — can move materially within that window.

Regional divergence: growth corridors versus a stalled capital

The national headline also masks a sharp geographic split that matters for anyone allocating capital by region. Every English region outside London has recorded rising applications through 2025 and into 2026, while London applications and new-build registrations have fallen back sharply — NHBC data shows London registrations down around 27% in 2025, driven by Building Safety Regulator delays, high affordable housing quotas and softer sales absorption rather than a lack of planning appetite.

By contrast, commuter-belt and regional growth markets — parts of Kent, Greater Manchester, Essex, Hertfordshire, the East of England and South East — are showing the deepest pipelines by unit count alongside comparatively stronger approval rates, with some southern counties posting consent rates well above the roughly 60-65% national average. REalyse comparables and planning-status data increasingly point to these markets as where reform-driven applications are most likely to convert into deliverable schemes, rather than the capital.

There's also a concentration story worth flagging for portfolio strategy. NHBC figures suggest a small handful of volume housebuilders now account for a disproportionate share of UK completions, while SME developers — who once delivered around a third of new homes — have seen completions fall faster than the market as a whole, squeezed by land costs, financing terms and the fixed costs of navigating a slower planning system. For lenders, that consolidation concentrates counterparty risk even as headline pipeline volumes look encouraging.

What this means for investment, lending and site selection

For developers and investors, the message is that a rising applications count should not, on its own, be read as a rising delivery signal. Robust site selection now depends more than ever on layering planning pipeline data against comparable sales evidence, achievable £/sqft, and realistic build-cost and absorption assumptions — rather than treating consent as a proxy for near-term supply.

For lenders and credit teams, the widening consent-to-completion gap is a useful lens for underwriting: schemes in regions where permitted volumes already exceed completions by a wide margin carry a different delivery-timeline risk profile to those in areas — increasingly concentrated outside London — where approval rates and build-out are moving together.

For agents and valuers, the practical implication shows up locally: constrained near-term completions in supply-short markets tend to support both achieved sale prices and asking rents, an effect REalyse's active listings data continues to pick up in areas where the pipeline is thinnest relative to demand.

Outlook

The Planning and Infrastructure Act and a rewritten NPPF have clearly changed developer behaviour at the front end of the pipeline. Whether that translates into materially higher completions by 2027-28 depends on factors largely outside the planning system itself — build costs, interest rates, and the sales market's ability to absorb new stock. Until starts and completions catch up with applications, the consent-to-delivery gap remains the metric institutional players should be watching most closely, not the headline applications number.