What does the government’s latest housing policy mean for the timber industry?

This week, the UK Government announced its latest effort to tackle the housing crisis. With housing a key driver of timber demand in the UK, we delve into what this latest announcement means for our industry.

The government has pledged to build one million homes over this Parliament session by “prioritising building in inner-city areas where demand is highest and growth is being constrained”. This, they argue, can be achieved through relaxed planning laws, a new £24 million Planning Skills Delivery Fund and £800 million to ‘unlock’ up to 56,000 homes on urban brownfield sites.

At first glance, the timber industry should welcome this latest announcement. Planning has been a thorn in the side of many developers in recent years, with stringent regulation and administrative backlogs halting housebuilding progress across the country.

Additionally, investment in brownfield development can be seen as good news. Timber construction requires fewer deliveries, less labour onsite and is often quieter to assemble than steel and concrete construction, making it ideal for urban housing developments.

We will look to engage with the Department for Levelling Up, Housing and Communities in the coming weeks to get this message across.

However, overall, this latest government announcement falls short of what is required.

To begin, there are question marks over the funding of the government’s brownfield construction pledge. Two weeks ago, Levelling Up Secretary Michael Gove returned £1.9 billion to the treasury after reportedly struggling to find projects to spend it on.

Officials said the department was unable to spend the money thanks to rising interest rates and uncertainty in the housing market after the Covid-19 pandemic. This, however, was last week’s narrative, with housebuilding now firmly back on the agenda.

We also echo the view of the National Housing Federation, which describes the latest announcement as “piecemeal” due to its failure in addressing affordable housing shortages.

The private sector has proved unable to match demand for housing in recent years, with the government consistently falling short of its 300,000 new homes a year target. In our latest APPG report, we argue the government should take a more active role in housing delivery, embarking on an affordable housebuilding program.

Government interventions are essential during a time of financial difficulty, particularly in the housing sector. By investing directly into affordable housing, the government can satisfy the social demand for housing in a time when interest rates are high and market demand is low.

This can be done in a way which raises standards for industry, by procuring homes that maximise carbon savings through embodied carbon limits and ensure quality delivery through modern methods of construction (MMC).

In his seminal paper ‘Modernise or Die’, Mark Farmer noted the construction industry has comparatively one of the lowest levels of R&D spending in the UK. Affordable and low-carbon housing procurement can catalyse this investment by creating the continuity of demand required for research and development.

This policy does not have to be pro-timber or timber specific. Rather, growing demand for timber will come about naturally through sensible policies aimed at increasing low-carbon, affordable housing in the UK.

While the pledges are a good start, what the UK needs is a properly funded long-term affordable, low-carbon housing plan – which this is not.