Redrow are whinging about planning conditions – again!

Earlier this week Redrow reported that the company is making “good progress” as a result of the Government’s Help to Buy scheme. Private reservations for the financial year to date are up 52% at 1,400 homes, with Help to Buy reservations representing 35% of total private sales over the period. The average selling price of private reservations is 11% up on the same period last year, at £271,000.  

Redrow reported that they have increased their current land bank, (land with a planning permission) both owned and contracted, by 2,000 plots to just over 15,000 plots in total – well over five years supply, based on their 2012 total completions. 

Despite this, Redrow used the interim management statement as yet another opportunity to lobby for a further relaxation in planning regulations and conditions. Whilst acknowledging that the growth in the company’s land bank over the last two years had been helped by the changes in the planning system, brought about by the NPPF, Redrow stated that over 5,000 plots are,

“in the planning system awaiting reserved matters approval or clearance of pre-start conditions. The regulatory burden involved in obtaining detailed permission and clearing conditions is the biggest constraint to the industry increasing production.”

It is up to house builders, including Redrow, to manage the discharging of planning conditions and ensure they have adequate staffing levels to progress the clearance of pre start conditions to suit their own production requirements. Any further reduction in regulatory control and conditions attached to planning permissions would result in a unregulated house building free for all.

As many within the industry already know, house builders are hanging on to their land waiting for house prices to increase further. Why would any builder choose to build 3,000 more homes this year, when they can make an extra 11% profit by building them next year? Even if the house builders wanted to increase the number of new homes they are build it is doubtful they could. There is a shortage of basic materials such as bricks and blocks even at the current build rate, with some sites having to wait up to six months for certain bricks and others are importing blocks from the continent. Any increase in the number of new homes built would be restricted by associated supply factors and labour skill shortages with many trades choosing to leave the industry for good in the aftermath of the financial meltdown.

Time to stop whinging about planning conditions Redrow, and set about focussing on improving the quality of the homes you do build. There has never been a better opportunity for all house builders to sort out their quality issues, with  easy sales up, profits up, prices up.


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