BLOGS

The UK's housing crisis has defied successive policy interventions. Now, eighteen months into Labour's tenure, the government's ambitious planning overhaul faces its first real test. With mandatory targets restored, green belt protections loosened, and local authorities under unprecedented pressure to deliver, the question is no longer whether reform was needed—but whether these specific changes can translate into homes on the ground.

The scale of the challenge

REalyse planning data reveals the sheer volume sitting in England's development pipeline. Across 73 tracked regions, the average approval rate stands at approximately 72%, with a median decision time of 171 days—nearly six months from submission to determination.

Central London alone accounts for over 385,000 units in the pipeline, yet only 70.5% of decided applications there receive approval. Meanwhile, regions like Greater Manchester (79.4% approval rate) and Cornwall (81.5%) demonstrate that planning bottlenecks vary significantly by geography.

The numbers paint a picture of a system straining under volume. High-demand areas like Kent, Essex and Surrey each have between 80,000 and 185,000 units in various stages of the planning process, with substantial proportions still pending decisions.

What the NPPF reforms actually change

Published on 12 December 2024, the revised National Planning Policy Framework represents the most significant planning intervention in over a decade. The headline changes include:

• Mandatory housing targets restored: Local authorities must now work towards meeting their full identified housing need, with England's combined annual target set at 370,000 homes—up from the advisory 300,000 figure under the previous Conservative framework

• Grey belt introduced: A new land classification for previously developed land within the green belt, plus any other green belt land making "limited contribution" to its five statutory purposes. Councils must now review green belt boundaries if they cannot otherwise meet housing need

• Golden Rules for green belt release: Major developments on released green belt land must deliver up to 50% affordable housing, alongside infrastructure and accessible green space

• Tighter local plan deadlines: From 12 March 2025, new requirements came into force. Local authorities relying on outdated plans must demonstrate a six-year housing land supply (rather than five) from July 2026

The government's intention is clear: shift the presumption in favour of development, particularly where affordability is most acute.

Green belt under pressure

REalyse data on green belt planning activity in England shows the policy context shifting well before the December 2024 reforms. Over the past five years, residential applications on green belt land have averaged around 1,500–2,000 annually, with approval rates typically in the 64–67% range—notably lower than the national average.

In 2025, following the NPPF changes, green belt applications submitted rose to over 1,600, with more than 75,000 units proposed across these schemes. Approval rates have remained relatively stable at around 66%, suggesting councils are still exercising caution despite the new framework.

The grey belt concept is designed to unlock "lower quality" green belt land—disused car parks, scrubland, and brownfield sites that happen to fall within protected boundaries. However, the definition remains contested. Environmental groups warn of mission creep, while developers argue the criteria are still too restrictive to meaningfully boost supply.

Crucially, green belt reviews take time. Even with the new requirements, most councils will need 18–24 months to update their local plans, meaning the full impact of grey belt policy may not be felt until 2027 or 2028.

Regional pipeline disparities

The development pipeline across England reveals stark regional differences that will shape how effectively the reforms translate into delivery.

REalyse data shows the South East and East of England consistently lead in proposed units, with the South East alone accounting for over 100,000 units submitted in 2025. The North West and West Midlands follow, each with 35,000–40,000 units in the 2025 pipeline.

London presents a paradox: despite the capital's acute affordability crisis, its 2025 pipeline stood at approximately 31,500 units—significantly below regions with far lower population density. The new NPPF actually reduces London's target by almost 20,000 homes annually, replacing the previous "urban uplift" with a stronger affordability multiplier that redistributes pressure to commuter belt areas.

This recalibration means counties like Hertfordshire, Essex and Kent face substantially increased targets, even as their planning systems already struggle with high application volumes.

Delivery versus approvals

The fundamental challenge remains: planning permission does not equal homes built.

REalyse pipeline analysis shows significant lag between approval and completion across all regions. The government's own figures, reported by Full Fact, indicate that between July 2024 and June 2025, approximately 186,600 net additional homes were built—just 12% of the parliament-long 1.5 million target.

The OBR projects that NPPF reforms will deliver 305,000 homes annually by 2029/30, the highest level in 40 years. Yet this still falls short of the 370,000 annual target. Centre for Cities research suggests the government may miss its overall target by at least 388,000 homes.

Several structural barriers explain the gap:

• Viability constraints: Rising construction costs, elevated interest rates and Section 106 obligations mean many approved schemes remain unviable to build out

• Skills shortages: The construction sector lacks sufficient labour capacity to scale delivery, regardless of planning permissions granted

• SME squeeze: Small and medium-sized housebuilders, who historically delivered a significant share of completions, have retreated from the market due to regulatory burdens and financing constraints

• Infrastructure deficits: Water, power and transport capacity increasingly constrain where development can practically proceed

What comes next

The government has signalled that the December 2024 NPPF is merely the first phase. A further consultation launched in December 2025 proposes additional changes, including standardised benchmark land values for green belt sites (set at 10 times existing use value) and potential national minimum requirements for social rent provision.

The forthcoming Planning and Infrastructure Bill, flagged in the 2024 King's Speech, promises more fundamental reform—though the legislation has yet to be published.

For developers, investors and local authorities, the immediate priorities are clear:

1. Local plan alignment: Councils have until mid-2026 to demonstrate compliant housing land supply or face the presumption in favour of development

2. Green belt review strategies: Land promoters should identify grey belt opportunities in constrained markets, particularly where local plans are outdated

3. Viability stress-testing: With golden rules demanding up to 50% affordable provision on green belt sites, scheme appraisals must factor in higher policy requirements

4. Pipeline monitoring: Tracking planning decisions, appeal outcomes and emerging local plans will be critical for identifying both opportunity and risk

Outlook

Labour's planning reforms represent the most pro-development policy framework England has seen in a generation. Mandatory targets, grey belt release and tighter local plan requirements create genuine pressure on the supply side.

Yet planning reform alone cannot build houses. Viability, capacity and infrastructure constraints mean the journey from permission to completion remains long and uncertain. REalyse data suggests that while the pipeline is substantial—millions of units sit at various stages of the planning process—conversion rates remain the critical variable.

Over the next three to five years, success will depend less on policy ambition than on whether the broader ecosystem—finance, labour, materials, utilities—can respond. The planning shake-up may have unlocked the door, but the construction sector must still walk through it.