There are growing concerns that the Government will introduce an increase in the tax paid by builders to remove unwanted soil from sites, with the plan expected to add millions of pounds to the price of major infrastructure projects.

Following Zoopla's viability report which highlighted that the 1.5 million new homes target is only currently achievable across just half the country, please see the following quote from Zoopla on recent reports that housebuilders may face additional build costs in the Autumn Budget.

Richard Donnell, Executive Director at Zoopla said:

“The cost of developing homes is rising faster than sales values which is reducing the viability of home building across the country. The Government says it wants to 'build baby build', yet our most recent analysis shows that this can only be currently achieved across just 48% of England, in areas that are typically more expensive for consumers to buy.

Our research has found that the cost of building new homes rose on average 17% between 2022 and 2024. While the government can't control the price of raw materials like bricks or concrete, it can influence the rising costs of new regulations. Any proposals that add to the policy cost of building homes will undermine the pressure to the delivery of new homes.

While recent planning reforms and affordable housing funding are positive steps, adding additional costs to already strained margins will only make it harder for home builders to deliver homes across the country, and will further challenge delivery in areas where it is currently affordable for home buyers to purchase.

 "Further reforms, not restrictions, are needed to boost capacity and speed at the local planning level and new funding should be focused on immediate, not long-term, delivery. Building more homes is vital in helping to ease the pressures facing those in the housing market, but the viability of building is at risk from further cost increases and we can't rely on higher house prices to fix it.”

For further information, please don't hesitate to get in touch at zoopla@mhpgroup.com

Full press release available under the attachments.