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Britain's Prime Minister Theresa May makes a speech London
Image: Britain's Prime Minister Theresa May makes a speech London. REUTERS/Frank Augstein

Theresa May Blames Councils for UK Housing Crisis

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Image: Britain's Prime Minister Theresa May makes a speech London. REUTERS/Frank Augstein

Prime Minister Theresa May has faced stark criticism after blaming “nimby councils” for the housing crisis. May pointed the finger at large builders and local authorities, stating that they did not “do their duty.”

Aiming the Blame

Prime Minister May’s most recent major speech addressed the UK’s housing “crisis.” At the same time, she knew exactly who to blame for the abysmal homeownership situation in the country. She called out local “nimby councils” and big housing developers for not having done their jobs.

That said, critics were widespread and vocal, calling May’s accusations a cheap tactic and a gimmick to shift the blame for her own government’s failings.

According to Local Government Association chair and council leader, Lord Porter, those critics have a point. Moreover, he stated that local government has the figures to prove that the council planning departments are not to blame for the current UK housing crisis.

Are the “Nimby Councils” to Blame?

The association’s data shows that of every 10 planning applications it received, 9 received an approval. It also stated that in the stations where the refusals were appealed, the Planning Inspectorate upheld 73 percent of the council’s decisions. Therefore, of every appealed refusal, nearly three out of every four were deemed to have been justifiably turned down.

From 2016 to 2017, the association gave the nod to 321,000 new homes. That said, of those that received the green light, only 183,000 were actually constructed. Furthermore, there are currently 423,000 homes that have received their approval in recent years that continue to await their construction.

Therefore, Lord Porter, a Conservative, pointed out that if there is a barrier to home building, the planning system is not to blame. The approvals are there even if the homes are not, says the data.

Are Home Builders to Blame?

The Local Government Association data indicates that the blame needs to be shifted elsewhere. Some have looked to the large homebuilders. They claim the builders are land banking for the purpose of making a profit by holding back supply and driving up values.

However, critics have pointed out that homebuilders have a wild spectrum of motivations not to build in the current real estate landscape.

That said, builders, on the other hand, have said they are constructing homes as quickly as they can and that the prime minister has misunderstood their business model.

The builders explained that in order to begin, they must accumulate a large permission inventory – an adequate supply to keep them going for several years in advance – in order to make homebuilding a healthy business. Should they reach the point in which they have run out of the permissions or land they need to keep going, they could find themselves without adequate raw materials for selling and making a profit.

Note: The opinions expressed in this article are the author's own and do not necessarily reflect the view of Alvexo on the matter.