"Not only could we see a very notable boost to the number of new homes reaching the market, but over the next five years these new homes would also bring a sizable boost to the overall value of the property market."
- Director of Benham and Reeves, Marc von Grundherr
Should Labour honour its commitments to deliver 370,000 new homes a year, it would not only boost housing delivery by 22%, but it could bring a £161.6bn boost in value to the housing market across England, new analysis shows.
Benham and Reeves looked at the increase in housing delivery proposed by Labour via reforms to the National Planning and Policy Framework, where across the nation is set to see the biggest boost in new housing stock if this proposal is met, and the potential added value it could bring to the property market.
The research shows that across England the proposed increase in new homes delivered from 305,223 per year to 371,541 would boost housing supply by 21%.
Over the last five years, the average new build home has increased by an average of 3.5% per year in value and Benham and Reeves estimates that over the next five years, £161.6bn worth of property could reach the market should Labour deliver on its promise of 371,541 new homes per year.
Regional breakdown
The North East is set to see the largest boost to housing stock should Labour come good on its promise, with the proposed method estimated to increase the level of new homes reaching the market by 99%.
London is the only region expected to see a reduction in new housing delivery under new proposals, with the number of new homes built each year forecast to fall by 18%.
Despite this reduction, London is still expected to see by far the most value added to the property market via the construction of new homes, with an estimated boost of £46bn over the next five years.
Which local authorities will benefit most?
Redcar and Cleveland is the local authority set to see the biggest boost to housing stock under Labour’s new housing delivery proposal. The area is set to see the level of new homes climb to 642 per year - an increase of 1,338% versus the 45 per year delivered via the current method.
Burnley (625%), Westmorland and Furness (531%) and Hyndburn (528%) are also expected to see an increase of over 500% in the number of new homes delivered under new Labour plans.
When it comes to the highest market value of potential new stock delivered over the next five years, Kensington and Chelsea sits top. Not only is the borough set to see a 209% increase in the number of new homes delivered each year under new proposals, but over five years, this new housing stock is estimated to bring an additional £5.1bn in added value.
Director of Benham and Reeves, Marc von Grundherr, commented: “Our new Labour Government has been ambitious from the get go when it comes to the proposed shake up of housing delivery targets and not only could we see a very notable boost to the number of new homes reaching the market, but over the next five years these new homes would also bring a sizable boost to the overall value of the property market.
"Of course, some areas are set to benefit to a far greater extent than others and it's interesting to see that, under new proposals, London is the only region expected to see a decline in housing delivery. This is despite the fact that it’s probably one of the worst hit areas with respect to a shortage of housing to meet demand.
"It’s also important to note that housing delivery has sat well below any Government target set for quite some time now and so whilst the new targets set out by Labour are admirable, it means very little if they aren’t honoured.”
