Is it quicker to build homes on large sites, or small?

Too slow, guys. Image: Getty.

The associate director of planning consultancy Nathaniel Lichfield & Partners explains why large new housing sites aren’t a silver bullet.

Most people now agree that we need to build significantly more homes than we currently do – and the government wants planning to think big in how it goes about achieving this objective.

With its “locally-led” garden towns and villages agenda, and last December’s consultation on proposed changes to the National Planning Policy Framework to encourage new settlements, local planning authorities and developers are being encouraged to look closely at bringing forward large-scale housing development projects.

On paper, this emphasis on large sites is useful: with just one site of several thousands of homes, a district can meet a significant proportion of its housing requirement. Moreover, their sheer size can stimulate the local economy and drive innovation as the site and infrastructure are developed.

However, large sites are not a silver bullet. Their scale and complexity mean that they take time to plan and require significant upfront capital investment. Furthermore, there is a need to be realistic about how quickly they can deliver new homes – such sites are not immune to the challenges and risks of the market.

Our latest research report, Start to Finish, analyses the lead-in times, planning period and delivery phases of housing sites. Here are our key findings.


Planning period

Before any homes can be built on-site, an outline or full planning application needs to be submitted and planning permission (followed by reserved matters approval for outline applications) has to be granted. A Section 106 obligation will generally need to be entered into. Pre-commencement conditions need to be discharged before any development start on-site. 

Our research shows that both the planning period (from application to decision), and the period of time between permission being granted and the first home being built, depends on the complexity of the site, which frequently correlates with its size.

And the larger the site, the longer the planning application determination period. Sites outside of London of between 100 and 499 units take, on average, 2.5 years – at least half the time required for sites of over 1,000 units – reflecting differing levels of site complexity.

By contrast, smaller sites take longer to deliver the first home after planning approval. This period of development takes just over 18 months for sites – outside of London – of under 500 units; but, perhaps surprisingly, this is significantly quicker on larger sites – in particular, on the largest 2,000+ dwelling sites, the time period from planning to first completion was under a year. This could be because larger sites may more often have larger housebuilders on board by the time an implementable permission is secured, thus be able to mobilise resources quicker.

Planning period by site size. Source: NLP analysis.

Housing delivery rates

It is widely recognised that build rates on sites are dictated by the number of sales outlets and market absorption rates. Self-evidently, large sites will frequently have more than one housebuilder building and selling homes. The larger the site, the greater the number of different housebuilders on-site and the faster the delivery rate. 

Based on our research, we found that, on average, sites of 100 to 1,000 units will typically deliver 60 units each year, while sites of 2,000 or more will deliver over 160 units per annum.

However, it is worth noting that while larger sites have a higher delivery rate due to the number of additional outlets, they take longer to plan and start on-site. There is also significant variation from the average: some sites can be quicker, others slower. And there are fluctuations from year to year.

Housing delivery by site size. Source: NLP analysis.

Our analysis shows that markets really do matter for housing delivery rates. Using estimates of land value with residential planning permissions at local authority level – as a proxy for market demand and economic strength – relatively stronger markets tend to have higher delivery rates.

This raises an important point about absorption rates: in stronger areas, housebuilders are able to build homes at a faster rate and sell them at the value they expect.

Housing delivery rates and market strength. Source: NLP analysis.

Where viable, housing sites with a larger proportion of affordable homes deliver more quickly. For both large and small-scale sites, developments with 40 per cent or more affordable housing have a build rate that is around 50 per cent higher, compared to developments with less than 10 per cent affordable housing.

The relationship between affordable housing provision and delivery rate is complex and rests on a variety of factors including viability and the level of grant or subsidy available to housing associations. On large sites, securing affordable housing “sales” can benefit housebuilder cash flow by providing financial certainty, which can be beneficial, particularly early on in a larger scale development.

However, it does demonstrate that – where viable – a tenure mix that extends beyond just housing for sale can help overcome the natural limitations associated with absorption rates. So the introduction of self-build and private rented properties might similarly increase rates of development.

Affordable housing provision and housing delivery. Source: NLP analysis.

If we are serious about achieving the Government’s target of one million homes built by 2020 – or indeed, deliver the 300,0000 per year that are needed – we need to recognise that it is about much more than just having a headline number of units in plan allocations or with planning permission. We need to understand trajectories of development: the length of time it takes for sites to come forward and the rate at which they deliver homes.

Every site is different, and there is a need for local authorities to understand the barriers and drivers of delivery in their area, seek to allocate appropriate housing sites in response and then closely monitor their progress.

Joe Sarling is associate director of planning consultancy Nathaniel Lichfield & Partners. This article was originally posted on the firm’s blog

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Pembrokeshire's innovative new eco-hamlet is great. But it should be the size of a city

The eco hamlet. Image: Western Solar.

The opening in January 2017 of an “eco-hamlet” for council house tenants in West Wales is great news. I have nothing but praise for a development which builds houses with a low carbon footprint, using locally grown wood, to make homes which are well insulated and powered by solar energy. It was also quick to build, with large sections being made in a factory and then assembled on site. And it was relatively cheap – at around £70,000 to £100,000 per building, it is certainly comparable to the costs of more conventional builds.

These houses are an inspiration to the construction industry and an aspiration for the home owner. After all, who wouldn’t like to live in a house that had yearly utility bills of £200, rather than the national average of £1,500?

So the problem is not the six wonderful solar houses at Glanrhyd, Pembrokeshire, or the lucky people who will get to live in them (and enjoy shared use of an electric car). The problem is that we’ve seen all of this before – but nothing changes. What we really need is far, far more of them.

Pentre Solar in Pembrokeshire. Image: Western Solar.

I’ve been involved in sustainable construction for nearly 25 years and seen many inspirational developments like Glanrhyd. There’s Julian Marsh’s home in Nottingham, Susan Roaf’s Oxford Ecohouse and the Hockerton Housing Project, to name but a few. The list is long.


Yet while many individuals continue to build these innovative and inspirational structures, we have a construction industry which still responds to these buildings with disdain. One executive from a large well-known house building company told me recently: “This is a new, expensive and untested technology. We just can’t risk building something so new with all the risks to the consumer and at a higher cost.”

But the situation is even worse than the disdain from the mainstream construction industry. Rather than being welcomed, the latest versions of these sustainable buildings are challenged at every turn. The initial response to the Welsh eco-hamlet plans were concerns about the materials, the technology and the design. The houses at Glanrhyd then had more than 20 planning conditions placed upon them. The CEO of Western Solar, the company behing the hamlet, freely admits that nearly half of their research budget went on solving problems they encountered along the way.

Thinking and building big

So it seems this kind of development just isn’t celebrated enough. There is a general atmosphere of mistrust from construction professionals. It is seen as too complex, too expensive, too risky. Yet there are positive reactions, too. Welsh politician Lesley Griffiths had this to say about the new houses in Glanrhyd:

This scheme ticks so many boxes. We need more houses, we need more energy efficiency, we want to help people with fuel poverty. It’s been really good to hear how they have sourced local products. It’s great they’re using local people to build the houses.

Surely we need to take the eco-technology we have and start rolling it out on a much larger scale. To do so would be a massive step in meeting the significant housing shortage (an estimated 125,000 extra new houses are needed every year). It would also address the disrepair of our current housing stock, and help refit the millions of houses in good repair but requiring improved performance in order to achieve the government’s 2050 carbon reduction target.

We must not forget that the 2050 Climate Change target is not some arbitrary political policy, but one based on the environmental challenge facing all of us. We need to play our part in slowing down the speed of climate change and adapting to the changing natural, social and economic environment.

The solar houses in Pembrokeshire are wonderful. But until we start building huge numbers of buildings with similar credentials, we are just celebrating a cottage industry rather than restructuring our urban environment for an uncertain future.The Conversation

John Grant is senior lecturer in natural and built environment at Sheffield Hallam University.

This article was originally published on The Conversation. Read the original article.