Housing crisis stalls as confidence drops and development costs soar

Prosper UK's Housing Commission, launched in January, identified falling consumer confidence and the financial unviability of many new-home schemes as the twin barriers to meeting the government's target of 1.5 million homes in five years. Developers face a £76,000 increase in average build costs since 2020, driven by inflation and regulations such as the Future Homes Standard, while house prices have barely risen, squeezing margins.

To address demand, the commission proposes a limited shared-equity program covering roughly one-fifth of sales per site, funded by an industry access fee. On the supply side, it calls for a three-year moratorium on new regulatory obligations and stricter tests on any new requirement. Additional suggestions include a National Planning Service for large projects, stronger support for under-resourced councils, and one outlet of the Green Belt to release non-essential land. The report notes that both Labour and Conservative parties have signaled support for some of these measures.