Wales Parliamentary Newsletter – March 2025

The Home Builders Federation (HBF) is the representative body of the home building industry in England and Wales. Our members are responsible for providing around 80% of all new private homes built in England and Wales, and are mostly small or medium-sized enterprises.

The latest Welsh Government figures show that the home building industry delivered 26% of all new Affordable Homes in Wales in 2023/24 through Section 106 agreements – a critical contribution to the Welsh Government’s 20,000 social homes target.

Section 106 agreements between private developers and local authorities require a certain percentage of homes on each new site to be Affordable Housing. These Affordable Homes are then bought at a reduced price by Registered Providers (RPs).

The figures on affordable housing provision, released at the end of last year, show that:

• 3,255 affordable homes were delivered in total in 2023-24.
• Of these, 856 affordable homes were delivered by the home building industry through Section 106 Agreements.
• When excluding acquisitions of affordable housing, however, the proportion of affordable homes delivered by the industry is closer to 45%.

Therefore, increasing the supply of affordable housing and delivering on the Welsh Government’s affordable housing ambitions will require a significant uplift in the number of new homes for private market sale, as this will create more opportunities to deliver affordable homes through the Section 106 mechanism.

View the data on Affordable Housing provision in 2023-24 on the Welsh Government website.

HBF has welcomed the Welsh Government’s confirmation that it will extend the Help to Buy Wales equity loan support scheme by another 18 months, to the end of September 2026.

In response to the extension, Neil Jefferson, Chief Executive at HBF, said:

“We warmly welcome the Welsh Government’s extension of Help to Buy Wales given the ongoing challenges faced by first-time buyers amidst a lack of affordable mortgage availability.

“As well as helping people who can afford to buy to do so, the scheme will also provide certainty of demand for house builders that will allow the industry to invest in housing delivery.

HBF has engaged closely with the Welsh Government on the scheme, and in September we released a report on the scheme which outlined that:

• Over 14,000 households have been supported to buy a home through the scheme.
• 46% of all loans have been repaid in full, with a return of over £40 million to the Welsh Government.
• In the first nine years of the scheme, a quarter of newly completed homes were sold through Help to Buy Wales.
• On average, the scheme has supported 4,400 jobs and generated £240 million in economic activity every year.

HBF also provided a written submission to the Senedd Finance Committee ahead of the Draft Budget, which called for the scheme’s extension and outlined various other asks of the Welsh Government to increase housing supply.

HBF/Glenigan’s latest Housing Pipeline report shows that housing supply will continue to fall short of demand in Wales in the months and years ahead.

The report includes data on planning permission approvals – a lead indicator of future housing supply - up to the final quarter of 2024. While the data shows that there has been a slight upturn in approvals in recent months, they also remain well below pre-pandemic levels.

The report shows that:

• The number of overall housing projects granted planning permission in the final quarter of 2024 was 110 - 3% lower than the previous quarter.
• The number of projects approved in Wales in 2024 totalled 469 – 5% higher than in 2023, but still around 45% lower than pre-pandemic levels.
• The total number of homes approved in Wales in 2024 was 7,762 – up 10% from 2023, but 35% lower than the 2019 peak.

The ongoing decline in housing supply comes amid a period of high interest rates and slow progress in updating Local Development Plans (LDPs) across Wales, with 11 LDPs now having expired.

View the latest Housing Pipeline report here.

The delivery of thousands of new homes is being severely delayed as local authority planning departments struggle with severe staffing shortages, new research reveals.

The Planning on Empty report is based on a Freedom of Information (FOI) survey which received responses from 134 local planning authorities (LPAs) across England and Wales and asked questions regarding local planning department vacancies, use of agency workers, and staff turnovers.

The survey shows that 80% of LPAs are operating below full capacity, with many unable to keep up with the rising demand for housing applications. A lack of staff and resources in LPAs causing errors and administrative discrepancies in the planning process, leading to delays in the delivery of homes of all tenures.

Wrexham had the second-highest turnover rate of planners of any local authority in England and Wales in 2023/24, at 32%.

The new research follows a report last year by Audit Wales – the official auditor of the Welsh public sector – which called on the Welsh Government to increase capacity in local planning authorities (LPAs). Audit Wales said that ‘the Welsh Government should work with local government partners to develop sustainable solutions to the capacity and delivery constraints in local government planning services’ in order to meet its social homes target.

Read HBF’s Planning on Empty report in full.

New HBF research estimates that local authorities in Wales are sitting on £128 million of Section 106 contributions. These contributions are paid to local authorities to fund affordable housing, infrastructure and amenities to improve the local area for new and existing communities, as part of the process of granting planning permission.

HBF's research is based on a Freedom of Information (FOI) survey which received responses from 16 local authorities in Wales. The responses show that:

• On average, councils hold £5 million in unspent Section 106 infrastructure contributions.
• If extrapolating out to all Welsh councils, around £128m is likely to be held unspent in total across Wales - up from £112m last year.
• Cardiff Council holds the most in unspent contributions in Wales, holding £33.4m, including £10m for Affordable Housing and £8.2m for highways and roads.

These contributions are being held unspent for extended periods of time due to insufficient financial and staffing capacity within local authorities, as well as ineffective monitoring of funds – reaffirming the need for Local Planning Authorities to be sufficiently staffed and resourced.

Read the unspent developer contributions report in full on the HBF website.

HBF has launched its sixth cohort of the Women into Home Building programme. Delivered in partnership with 11 home builders, this latest cohort will provide 38 women with training, support, and work placements across England, Wales and Scotland.

With women currently accounting for just 16% of the construction workforce and only 4% of site managers, the programme plays a crucial role in addressing the sector’s gender imbalance while helping to tackle the industry's ongoing skills shortage.

Since its inception, the Women into Home Building programme has successfully guided 92 participants through training and work experience and supported 26 candidates into employment within the home building industry.

Neil Jefferson, Chief Executive at HBF, says:

“Building the talent pipeline and growing industry’s workforce is critical to increasing housing supply numbers at the levels required. The Women into Home Building programme helps to introduce more prospective talent to the rewarding careers available within the industry and offer valuable training to strengthen the industry's future talent pipeline.

“We are proud to collaborate with our members once again to deliver this programme at a larger scale than ever before.”

View more details on the programme on the HBF website.