"Our findings show that the levy could heavily impact project viability, particularly in high-value areas"
- Sian Metcalfe - Property Inspect
New research by Property Inspect suggests that the proposed Building Safety Levy could cost developers as much as £455 million annually. The findings have sparked concerns within the industry, with experts calling for the levy’s structure to be reassessed to ensure it supports essential safety improvements without stalling housing development.
The levy, introduced under the Building Safety Act 2022, would apply to new residential developments in England and be paid by developers. Its goal is to raise funds for vital safety remediation work across the country, without shifting the financial burden onto homeowners.
Although originally scheduled for implementation in March 2025, the government has delayed the rollout until Autumn 2026. The postponement aims to give developers more time to incorporate the costs into their plans — but what might those costs actually be?
Using proposed per-square-metre levy rates across various Local Authority (LA) districts and the average size of a new-build home, Property Inspect calculated the estimated levy per property, distinguishing between developments on previously used and undeveloped land.
The data reveals that Wandsworth, London, would carry the highest average levy per property. In Kensington & Chelsea, for example, new homes built on undeveloped land would incur a levy of £100.35 per square metre. With an average home size of 67.82 sq m, that’s around £6,806 per property. For homes on previously developed land, the cost drops to £50.17 per square metre, or £3,403 per property.
Other high-cost areas include:
Westminster: £6,647 (undeveloped), £3,324 (developed)
Hammersmith & Fulham: £6,231 / £3,116
Camden: £5,908 / £2,954
City of London: £5,903 / £2,952
In contrast, areas like County Durham would see far lower costs — just £861 per home on undeveloped land — followed closely by Hartlepool (£869), Pendle (£889), Middlesbrough (£922), and Burnley (£922).
Estimated revenue by Local Authority
Using 2023–2024 housing supply data, Property Inspect estimated the levy would have generated up to £455 million had all new homes been built on undeveloped land. If built on previously developed land, the total would be approximately £227.5 million.
Wandsworth would have seen the highest contribution at £11.2 million, followed by Newham: £9.3m, Barnet: £9.1m, Westminster: £8.4m, and Ealing: £8.3m
“We support the objectives behind the Building Safety Levy, and the delay to 2026 gives the sector a necessary window to review its structure and potential effects," comments Sian Metcalfe, Operations Director at Property Inspect, "Our findings show that the levy could heavily impact project viability, particularly in high-value areas. We join the British Property Federation and RICS in calling for a more inclusive, consultative review — especially to address concerns around build-to-rent and student accommodation developments, which may be disproportionately affected,"
"This delay is a vital opportunity to recalibrate the levy so it achieves its safety goals without jeopardising the delivery of new housing.”
