What challenges and priorities are on the housing horizon in 2025?

Instead of the targeted 1.5 million homes, 69 per cent of respondents said they believe that fewer than one million homes will be delivered by 2029, with one participant noting: “The country has never built 300,000 homes a year without councils shouldering a significant portion of the burden. I’m not convinced the funding will be in place for councils to deliver at the scale required.”

 

The survey drew responses from 173 participants across the UK, including representatives from housing associations, local authorities, construction and development firms, asset management companies, and consultancies. Over half of respondents were housing associations and local authorities, providing a cross-section of expertise and insight.

 

Commenting on the results, Richard Petty, head of residential valuation at JLL, said: “We’re expecting this year to be slow and sluggish, and I don’t think the brakes are going to come off in Q1. While there are positives to draw from the survey, overall, it highlights the challenges the sector continues to face in meeting the UK’s housing delivery targets, much as housing associations would like to do more.”

 

 

A notable 36 per cent of participants expressed doubts that housing is a top priority for the Labour government, with one respondent saying: “Angela Rayner has given time to it, and reform to planning has taken place. However, the National Insurance rise means there has been the unintended consequence of giving with one hand and taking away with another.”

 

Another pointed out the absence of meaningful funding to expand affordable housing and address net zero commitments: “There’s no real clarity on a UK-wide approach to delivering retrofit solutions for existing homes. There’s no clarity on standards for future homes.”

 

The survey revealed a mixed approach to housing delivery, with 47 per cent of respondents indicating that their immediate investment focus was on upgrading existing stock rather than building new homes. For the next five years, this trend remained largely unchanged, with a third planning to split their efforts equally between the two.

 

Commenting on this, one housing association said: “Without further capital grants, commitments to upgrade existing stock will inevitably lead to a reduction in new builds.”

 

Despite these challenges, as Mr Petty notes, there was some optimism. While 46 per cent of respondents said they plan to maintain their current development programmes over the next five years, 31 per cent said they intend to increase them. Of those looking to expand, nearly a third are aiming to boost output by more than 50 per cent, while a similar proportion are targeting increases of between 21 and 49 per cent.

 

 

The delivery of social rented homes remains a contentious issue. While 35 per cent of respondents planned to maintain their current levels, nearly 10 per cent expect to increase social rent provision by more than 50 per cent. 

 

Conversely, eight per cent anticipate a significant decrease in the proportion of social rented homes in their pipelines (more than 50 per cent). Much of this depends on local authority policies and government support, some participants said anecdotally.

 

Others highlighted the role of Section 106 (S106) agreements, with one saying: “If local authority partners write into their S106 policies that rented homes will be at social rent, that allows us to buy social rent homes through S106. If grant funding becomes available at higher rates, we would be delighted to deliver more. Lots of lobbying is needed here.”

 

Another added: “To push projects through from start to completion takes five years. Without government action to overcome inertia, big builders won’t be enthusiastic about properties that can be sold.”

 

Generally, S106 agreements faced criticism in the survey. Nearly 65 per cent of respondents agreed that S106 is not working effectively as a means to deliver affordable housing.

 

One participant explained: “Housing associations end up with what they are given and have limited control over design or specification. Affordable homes are often delivered at a pace dictated by sales, rather than community needs.”

 

Respondents identified lower costs (30 per cent), better quality stock (20 per cent), and suitability (14 per cent) as the top factors that would encourage them to purchase more S106 properties.

 

On this, one respondent said: “There needs to be a better/flexible way to use S106. In the case of apartments, it’s ludicrous to earmark a handful of flats for a registered provider. The unit types might not be what is needed, the affordability may be questionable, the service charges too high etc, but there’s an obsession with provision on-site, which is ridiculous. There needs to be more sanity.”

 

 

Meanwhile, the role of metro mayors in housing delivery divided opinion. While 57 per cent of respondents said they believe devolving more housing powers and financial resources to regional leaders would positively impact delivery, a significant third disagreed.

 

Respondents who said metro mayors would not impact housing delivery were spread across the country (rather than limited to areas where no metro mayors are active) – suggesting that some would have personal experience of metro mayors.

 

When asked which stakeholders cause respondents the most concern, funders (50 per cent), local authorities (49 per cent) and the regulator (24 per cent) came out on top. The media and credit rating agencies (both nine per cent) were also referenced.

 

At the same time, three main challenges dominated the housing sector’s concerns: limited resources (60 per cent), spending on existing homes (55 per cent), and a lack of clear government strategy (43 per cent). The cost of borrowing (30 per cent) and meeting sustainability standards (22 per cent) also weighed heavily on decision-making.

 

The survey underscored the urgency of addressing these barriers if the government’s housing ambitions are to be realised. While Labour’s commitment to reforming planning policies and empowering local authorities has been welcomed, sector leaders stressed the need for more targeted funding and clearer strategies to unlock progress.

 

As Marcus Dixon, director of UK residential research at JLL, notes: “All eyes will be on the government’s Spending Review later this year, particularly if we fail to see any significant uptick in housing delivery. If so, the government will no doubt realise that more incentives are needed to make meaningful change and support the increase in activity needed across all sectors of the housing market.”