New figures analysed by the Home Builders Federation (HBF) show the number of new homes receiving planning permission has fallen by 21% in the last quarter,
HBF’s latest Housing Pipeline report shows 45,315 new homes received planning permission in England in Q2 2026, the lowest quarterly total since 2012. In the year to Q2 2026, permissions were granted for 214,515 homes, the lowest annual total since 2013, down 8% on the previous year and 36% below the 2017 peak.
The figures are yet more evidence, said the HBF, of the need for the newly announced new equity loan scheme, Your First Home, to support first-time buyers and boost housing supply
The HBF went on to say the annual total represents 58% of the 370,000 homes a year identified in Government’s National Planning Policy Framework required to deliver on the ambitions of 1.5 million new homes in this parliament.
The report goes on to explain the decline in planning permissions is particularly pronounced for larger developments, as approvals for homes on sites with over 10 units in the months of April to June fell 21% from the previous quarter to 39,689 and 14% below Q2 2025. Approvals for private homes fell by 19% quarter-on-quarter and 15% year-on-year. Going further, the HBF said the continued deterioration of housing supply reflects “weak effective demand, constrained access to affordable mortgage lending and subdued market conditions”, which limit confidence and reduce home builders’ ability to invest in new sites. At the same time, rising construction costs, taxes, levies and policy requirements are putting further pressure on development viability.
Neil Jefferson, chief executive at the Home Builders Federation, says: “These figures show a housing pipeline being squeezed to historically low levels, with too few planning permissions coming forward to meet the country’s housing needs.
“The cumulative impact of higher taxes, increasing costs and layers of new policy requirements is making more and more sites unviable, while weak demand has been compounded by the absence of meaningful Government support for first-time buyers and a lack of affordable mortgage lending.
“The Prime Minister’s announcement of a first-time buyer support scheme is a hugely welcome step, and we look forward to working with Government to ensure the scheme is accessible to as many potential purchasers and home builders as possible.”
The Federation warned the Building Safety Levy, due to come into effect from 1st October, will add an estimated £2,320 to the cost of delivering a typical new home since 2020 and is already already having an impact with a recent survey finding 36% of small and medium house builders are already delaying, redesigning or cancelling schemes in anticipation of the levy.
Commenting on the HBF’s figures Fergus Charlton, planning partner with Michelmores said: “The changes to the planning system over the last two years, culminating in the new NPPF and the prescriptive use of delegated decision making, have been welcomed by the development industry. But there remains a risk permission will be refused.
“The propensity to accept that risk and submit your application is a function of the likely profits if the application is successful. The stagnant market curtails those profits. Applications to take advantage of the changes will only start flowing when housing demand picks up. The Your First Home initiative will go some way to stimulating that demand.”