Labour set to miss housing target deadline by eight years

The Labour government is on course to miss its flagship manifesto commitment to deliver 1.5 million new homes in England by an astonishing eight years, research reveals.

The study by West One Loans looked at Labour’s 2024 General Election commitment when it campaigned on a bold pledge to build the homes within five years.

That would require an annual average of 370,000 new homes being built.

Industry experts said the target was highly ambitious, if not unachievable.

Now, after nearly a year in power, evidence suggests Labour is significantly behind schedule.

Labour’s ambitious housing target

The lender’s co-head of short-term finance, Thomas Cantor, said: “The Labour government was quick to hang its hat on an ambitious target with respect to housing delivery and, with previous governments having consistently fallen short, this was understandably met with a great degree of scepticism.

“Of course, it is still early days, and Labour may well be in the process of laying the initial groundwork required to eventually pave the way for an explosion in new home delivery.

“But whilst it’s possible that they need time to overhaul planning rules, cut red tape and prepare and incentivise the nation’s housebuilders to increase output, it’s already looking as though the task of delivering what was promised is running away from them.”

He added: “This will come as little surprise to the industry who have been consistently calling for further market stimulation via government intervention of monetary policy.

“We simply haven’t seen enough done in this respect and given the lack of movement with respect to interest rates of late, the worry is that we aren’t unlocking the full potential of development activity at a time when it’s needed most.”

Take 12 years to build

The research does highlight some progress, noting that 86,000 new homes began construction in the three quarters since Labour took office in Q3 2024.

This marks a rise from the 68,080 starts recorded in the previous three quarters (Q4 2023 – Q2 2024).

However, the pace remains insufficient to meet the manifesto goal, the firm says.

Labour’s target refers to ‘net additions’ which includes new builds, property conversions and changes in building use.

Historical trends indicate that 89.8% of these additions stem from new-build developments, meaning that around 1.35 million of the 1.5 million homes must come from new construction.

At the current rate of 28,667 new build starts per quarter, or 114,667 annually, it would take nearly 12 years to achieve this figure, far exceeding the promised five-year timeline.

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