Andy Burnham, speaking at the Labour conference, has emphasized the need for policies that promote balanced economic growth across all regions, focusing particularly on the housing sector. Industry leaders see the development sector as a key driver for this growth but highlight several obstacles currently hindering progress.
According to Rob Perrins, executive chairman of Berkeley Group, homebuilding in the UK faces significant challenges due to taxes, regulatory burdens, and broader economic conditions—factors he notes are not the result of current government policy. While measures to streamline planning and development processes have been introduced, Perrins argues that these steps alone are insufficient to stimulate the housing market and unlock broader economic growth.
A recently launched scheme, Your First Home, aims to support traditional greenfield housing developments primarily outside southern England. However, Perrins points out that to maximize its effectiveness, the scheme requires adjustments to benefit buyers in London and the south of England. These include increasing the price cap, raising household income limits, and offering larger equity loans to better match local market conditions.
Perrins identifies a reduction in stamp duty on new-build homes as a potential "gamechanger" for the sector. He contends that current stamp duty surcharges deter early-stage investors, whose capital is vital for initiating projects, particularly those involving brownfield site regeneration. The Office for Budget Responsibility has indicated that lower housing supply is contributing to a downward revision of economic growth forecasts, making the upcoming October budget a critical opportunity to address this issue.
By cutting stamp duty for first-time buyers, downsizers, and investors purchasing new-build properties, Perrins estimates the government could unlock the construction of an additional 60,000 homes annually. He further suggests this increase in building activity would generate approximately £4 billion in extra tax revenue, potentially more than doubling the funding available for the national social and affordable housing program.
Beyond taxation, Perrins highlights regulatory costs as a major impediment. Since 2016, the accumulation of new regulations, taxes, and levies has reportedly added around £150,000 to the cost of delivering a typical two-bedroom apartment in London, not accounting for inflation in materials and labor. This escalating cost burden has coincided with a sharp decline in new housing starts in the capital—from 33,800 units in 2015 to just 10,000 in 2026.
He also cautions that the rising regulatory costs affect affordable housing projects, potentially reducing the number of dwellings delivered through the government’s £39 billion Social and Affordable Homes Programme. Perrins argues these issues could be addressed without new legislation or increased public spending by focusing on improving the functionality of the Your First Home scheme nationwide, reducing stamp duty on new-builds, and streamlining overlapping and excessive regulations that delay or prevent construction.
In summary, the housing sector’s stakeholders call on the government to take coordinated action across taxation, regulation, and targeted housing schemes to stimulate building activity and contribute to more balanced regional growth.