Outcomes of review into housebuilding published by Sir Oliver Letwin

Measures to ensure new homes are built faster and for thousands more British bricklayers to be trained to help meet government targets have been called for by a review of housebuilding in the UK.

The government commissioned Sir Oliver Letwin to analyse what could be done to speed up the slow rate of housebuilding on major sites. His report, published on Monday, warned that developers are slowing down the system by restricting the number of new built homes released for sale at any one time.

Known as the ‘absorption rate’, this practice is designed to stop an oversupply of new built homes flooding local markets, in turn driving down prices.

Letwin’s study, however, suggests that developers could increase the choice of design, size and tenure of new homes without affecting the local market. This would have the knock-on effect of speeding up the rate at which houses are built and sold.

“To obtain more rapid building out of the largest sites we need more variety within those sites”, his report concluded.

A dearth of British bricklayers is also causing issues, according to the report, and is set to have a ‘significant biting constraint’ on the government’s proposals to grow the number of new homes built from 220,000 a year to 300,000 a year by the mid-2020s.

The review calls for 15,000 more bricklayers to be trained over the next five years to address the shortfall, equivalent to nearly a quarter of the size of the current workforce.

“To raise production of new homes from about 220,000 to about 300,000…the government and major house builders need to work together…on a 5 year 'flash' programme of pure on the job training,” the report suggested.

Letwin and the review panel visited 15 large sites – home to between 1,000 and 15,000 homes - in areas of high demand in London, the South East, West Midlands and the North West.

“I would like to thank everyone who has contributed to the Review Panel's work to date in analysing all possible reasons behind the slow build out of housing sites,” Letwin, who is the MP for West Dorset and a former Cabinet minister, commented.

“It is clear that the main cause for delay is the absorption rate. We found that if house builders were to offer more variety of homes and in more distinct settings then overall build out rates could be substantially accelerated.”

Housing Secretary James Brokenshire said of the review: “We want to help people onto the housing ladder, and so I would like to thank Sir Oliver and the expert panel for their excellent work. I was particularly interested to see that increasing the choice of design, size and tenure of new homes in helping to speed up build out rates and help deliver the homes we need and communities want. I look forward to receiving the final report in the autumn.”

Letwin and his panel will submit final recommendations on improving build out rates in the autumn. You can see the draft analysis here.