GUEST COLUMN:
Laurence Thompson
Policy and Campaigns Officer
HBF
Prior to May’s election, Plaid Cymru set out ambitious pledges for its first 100 days of government, including a range of priorities linked to housing and planning. While it is too soon to expect significant changes on the ground, the new Welsh Government has made progress against these commitments, and the ambition of delivering 20,000 additional social homes during this Senedd term is clearly at the heart of its housing agenda.
This is an ambitious target, requiring a higher level of delivery than has been achieved in recent years. Homes for market sale and affordable housing are often delivered together on the same development, with private house builders providing around one third of all new affordable housing in Wales through Section 106 agreements each year. Supporting overall housing delivery can therefore also support greater delivery of social and affordable homes through the Section 106 route, helping to deliver the Welsh Government’s target.
Furthermore, delivering more market homes makes an important contribution to addressing Wales’ wider housing shortage. The Welsh Government’s own estimates, published in February, show that around 5,700 new homes for market sale are needed each year during this Senedd term to meet newly arising need, alongside around 3,000 affordable homes. This underlines the important role of market housing alongside social and affordable housing in meeting Wales’ wider housing need.
However, the backdrop for housing delivery is very challenging. The latest HBF and Glenigan data on planning permission approvals – an indicator of future housing supply – show that just 4,800 homes were approved in the year to March, 29% down on the previous 12 months.
The Welsh Government’s first 100 days have provided some encouraging signs that it recognises the need to support all those involved in delivering new homes. For instance, it is welcome that the work of the Affordable Housing Taskforce is being taken forward. The Taskforce identified many of the shared barriers that affect Registered Social Landlords (RSLs) and private developers alike, such as SuDS, land supply and local authority capacity.
It is also positive that the recent consultation on the National Development Framework for Wales placed emphasis on how planning decisions can be sped up and removing barriers to development proceeding. Work has also begun on Wales’s first Climate and Nature Action Plan, providing an opportunity to resolve nutrient issues in the river and marine environment which are currently stopping many homes being built in Wales.
The next step should be to set an all-tenure housing target for this Senedd term, alongside the target for social housing delivery. This would help galvanise the system around delivery while recognising the contribution that social housing, affordable housing and homes for market sale each make to meeting Wales’ housing need and supporting the Welsh economy.
Help to Buy Wales extension – supporting effective demand
Some of the Welsh Government’s earliest policy decisions also suggest that ministers recognise the importance of supporting effective demand.
In July, the Minister extended the Help to Buy Wales equity loan scheme for a further six months, until March 2027. The extension provides greater certainty for first-time buyers and the home building industry while the Welsh Government considers the future of the scheme. It also helps strengthen effective demand by enabling more first-time buyers to access new homes, giving home building companies greater confidence that there will be sufficient demand for the homes they build.
While these early signals are encouraging, the real test will be whether Help to Buy Wales is allowed to play its full role in supporting housing delivery beyond March 2027. Early indications are that the Government is considering a further extension covering the remainder of this Senedd term, although this may be subject to changes to the criteria. Such an extension would be welcome, not least because the previous cycle of short-term extensions, often announced only months before the scheme was due to end, created unnecessary uncertainty for both home buyers and developers and made it harder for home building companies to plan future investment.
The design of the scheme will also be important. Previous eligibility changes and reductions to the maximum purchase price led to a significant fall in take-up, limiting the scheme’s impact on demand and housing supply. HBF is calling on the Welsh Government to renew Help to Buy Wales for the remainder of the Senedd term and ensure the scheme is available to as many first-time buyers as possible.
The Welsh Government has also started establishing Unnos, a new national housing delivery body. While the details remain uncertain, speeding up the time and amount of social housing through Unnos is clearly the key objective for this body.
The Welsh Government should also seize the opportunity for this body to play a wider role in supporting housing delivery. For instance, Unnos could help assemble land that would otherwise be unviable for development, act as a troubleshooter to unlock stalled projects, or support small sites to come forward for SME home builders. If the Welsh Government takes this broader approach, Unnos could complement the work already being undertaken by local authorities, housing associations and the private sector, and help unlock sites that are currently not coming forward.
Recent HBF research highlights the wider benefits of increasing housing delivery in Wales. Every year, the home building industry supports around 17,500 jobs, generates more than £1 billion of economic activity and delivers over £100 million of investment in local communities.
Increasing housing supply would therefore not only help meet Wales’ housing need, but also support jobs, investment and the wider Welsh economy.
These wider benefits reinforce the importance of an all-tenure approach to delivery. Its emphasis on partnership working in the first 100 days, alongside early decisions such as the extension of Help to Buy Wales, are encouraging signals to the private sector.
As the Programme for Government and potential consultation on planning changes approach this autumn, it is vital that the Welsh Government builds on this constructive start by supporting the delivery of the full range and level of homes that Wales needs.
