BLOGS

A surge in bids, a bottleneck in decisions

Labour's planning reform agenda — anchored by December 2024's revised National Planning Policy Framework and the introduction of "grey belt" land release — was designed to unlock housing supply by softening the presumption against development on lower-quality green belt land. Two years on, the application data tells a genuinely interesting story, but not a simple one.

REalyse planning data shows the volume of homes proposed through new residential applications outside London has surged, climbing from roughly 50,000–90,000 units per quarter through 2023 and early 2024 to consistently over 110,000–140,000 units per quarter across most of 2025. That is a meaningful step-change in the scale of schemes entering the system, and it lines up with the timing of the NPPF revision and the wider push to lift local housing targets.

The question institutional investors, lenders and developers should be asking is not whether applications have surged — they clearly have — but whether local planning authorities (LPAs) are approving and processing that volume fast enough to turn paper pipeline into deliverable stock.

Approval rates are compressing, not expanding

This is where the reform story gets more complicated. Alongside the rise in proposed units, REalyse data shows the approval rate for residential applications outside London falling from around six in ten in 2023–2024 to closer to half that through the latter part of 2025, with the share of applications still sitting "in progress" climbing sharply over the same period — from a few hundred per quarter to well over a thousand.

In other words, more schemes are entering the pipeline, but LPAs are not deciding them any faster. Some of that compression reflects the natural lag of very recent submissions awaiting determination rather than outright refusal, but the trend across several consecutive quarters is consistent enough to suggest genuine strain on planning capacity, not just a timing effect.

London shows a similar but more muted pattern: submission volumes have held broadly steady at 800–1,000 applications per quarter, but approval rates have also drifted down from the low 50% range towards the low 40s. For developers underwriting London schemes, this reinforces a familiar theme — dense urban sites, competing land uses and resourcing constraints at borough level continue to slow throughput regardless of national policy signals.

For lenders and investment analysts, this divergence between application volume and approval velocity is the more actionable data point. A larger pipeline of proposed units is only useful to a fund's return model if a workable share of it is likely to convert to consent within an underwriting timeframe. Comparables built on granted schemes — not just submitted ones — remain the safer basis for GDV assumptions.

Why delivery hasn't shown up yet — and won't for a while

Perhaps the most important finding for readers testing the "is this reform actually working" question: transaction data shows no discernible new-build delivery uplift yet. That is exactly what should be expected, and it is not evidence the reforms have failed.

The planning-to-completion chain runs through several sequential stages — submission, decision, site start, construction, and finally a registered sale. Even where approvals do move faster, industry timelines for medium-to-large schemes typically run 18–36 months or more from consent to first legal completions, and considerably longer for large strategic grey belt allocations that often require phased infrastructure delivery. Given the NPPF changes only took effect in December 2024, it would be structurally impossible for reform-driven schemes to already be showing up as completed new-build sales in Land Registry data. Recent-quarter transaction figures should also be read with the usual registration lag in mind, as HM Land Registry data typically takes several months to fully reflect completed sales.

The more useful leading indicators for institutional readers to track over the next 12–18 months are: approval rate stabilisation (or further compression) outside London; the ratio of units in "granted" status versus units still "in progress"; and, where obtainable, land transactions on greenbelt/grey belt-flagged parcels as a proxy for developer land promotion activity ahead of allocation. REalyse's land parcel data — including greenbelt and brownfield flags, site area and density — is built precisely to help investors and lenders track this earlier-stage signal rather than waiting for lagging transaction data.

Outlook: a policy pipeline still finding its feet

The headline number — a genuine surge in proposed housing units, concentrated outside London — is real and represents the clearest evidence yet that developers are actively testing the market's appetite for grey belt and NPPF-enabled sites. But the accompanying fall in approval rates and the build-up of applications stuck "in progress" suggests the constraint has shifted from land availability policy to LPA processing capacity.

For developers, this points to underwriting discipline: treat submission volume as a market sentiment indicator, not a delivery guarantee, and weight site selection towards authorities with demonstrated throughput. For lenders and investors, tracking approval-rate trends and pipeline stage mix by local authority — rather than headline application counts — will offer a more reliable read on where grey belt reform is actually translating into bankable, deliverable schemes.