All new homes, land development and much of England’s economic growth start with a planning application. Yet for SME housebuilders, planning is no longer just a gateway, it has become a bottleneck that discourages investment, creates artificial scarcity and blocks the construction of urgently needed well-designed, locally integrated homes on small urban sites.
This is not an argument for lower standards. It is the case for a simpler, clearer and more predictable National Planning Policy Framework (NPPF), that helps unlock urgently needed housebuilding while protecting our environment, builds a more diverse and dynamic housing market, and supports UK economic growth. These views reflect my practical experience of 20 years of leadership of an SME developer, and my role representing the SME housebuilding sector on the Parliamentary Liaison Group for Housing Delivery & Growth.
The question is no longer whether planning needs to change, but whether we can make reforms that keep SMEs in the game, because without them, national housing targets become mathematically impossible.
National housing crisis is worst for the SME sector
The UK is facing both a national housing shortage and the weakest economic growth in the G7, according to the latest GDP data from the OBR. Planning and housebuilding statistics point to an alarming fall in delivery. The Home Builders Federation reports that planning approvals for new homes in 2024 fell to 242,610 units, the lowest in a decade and 26% below the 2019 peak. These units are concentrated across only 9,776 approved sites, the fewest on record. To meet government targets of constructing 370,000 new homes a year, approvals would need to rise by over 50%.
The planning bottleneck hits SMEs hardest. Without the balance sheets, land pipelines, or specialist teams of larger firms, SME’s are less able to absorb long delays and shifting requirements. The system rewards only the biggest housebuilders, quietly removing the businesses that historically delivered a large share of England’s homes. For smaller operators, planning uncertainty is not abstract, it dictates whether a project happens at all. Developers are told three months for approvals yet plan for three years, and that uncertainty feeds directly into the housing shortfall.
The consequences of this planning and delivery failure are tangible. Higher housing costs, reduced social mobility, and poorer living environments, particularly in urban areas follow directly. Public services, including the NHS, are placed under additional pressure against the backdrop of an ageing population. One stark symptom of this crisis is the increasingly common use of emergency accommodation: according to the Resolution Foundation over £2.8bn was spent on emergency accommodation for 130,000 households in 2025. Beyond the personal tragedy for those affected, this represents a lost opportunity for civic pride, regeneration, and local economic growth.
