Commentary
Houses are not homes: a question for Andy Burnham
By the time Labour gathers for conference at the end of the summer, Andy Burnham could be the party’s leader and the country’s prime minister. If he gets the keys, the housing question he inherits is the one almost everybody in this industry has now quietly accepted has failed, writes Phil Cooper of Hope Architects.
Labour’s 1.5m homes target requires roughly 300,000 net additions a year for five years. The actual rate is closer to 200,000. The OBR’s most recent forecast puts this Parliament’s likely delivery at around 1 million across the whole UK, not just England, and the Construction Products Association has said the government will miss the target “significantly”. Planning applications, the earliest reliable indicator of future supply, are running at less than half the level required.
The question Burnham should be asked is not whether he can rescue the 1.5m number. He cannot. Nobody can. The interesting question is what he should put in its place.
To answer that, you have to be honest about why the target is failing, and the honest answer is not the one Westminster wants to hear. It is failing because it asked the private housebuilding industry to do something the private housebuilding industry is not shaped to do.
The volume housebuilders are not a homes-supply industry. They are a land-and-finance industry that produces houses as a by-product of trading planning permissions, optimising sales rates, and managing build-out timing to support share price. That is not a moral failing. It is exactly what we have asked the sector to be, since before the era of Right to Buy began in 1980. The trouble is that build-out rate, the thing that protects sale prices and shareholder returns, is structurally incompatible with the volume the target demands. Asking Persimmon, Barratt or Taylor Wimpey to deliver 300,000 units a year is asking them to flood their own market and trash their own margins. They were always going to decline.
Someone will object that we have done this before. After 1945 we built nearly 300,000 homes a year for two decades, with a country in worse shape than this one. The objection is fair as far as it goes. We can build at scale when we decide to. But the post-war programme is not the unqualified success it is sometimes remembered as: vast estates were thrown up, and many were demolished within a generation because they had been built as housing rather than as communities. The numbers were hit. The places, in too many cases, were not. Any successor to the 1.5m target has to specify what we are actually trying to build, not just how many.
You can reform the NPPF and pour billions into the affordable housing programme, and the volume housebuilders will still build at the rate that suits their balance sheet. They are doing their job. Their job is just not the country’s job.
This is where Burnham’s record becomes interesting, because it suggests he has noticed the problem.
GM Mayor Andy Burnham speaking at Place RESI 2024. Credit: PNW
Housing First, his flagship homelessness policy in Manchester, commissioned an outcome, people housed and stabilised with wraparound support, rather than purchasing an output. It has produced an 88% tenancy sustainment rate and a 57% fall in rough sleeping in Greater Manchester. The £40bn council housing borrowing pitch he made to The Telegraph is the same instinct at industrial scale: the state as commissioner, not as customer. The Bee Network is transport built on the same logic. ‘Manchesterism’, read carefully, is a willingness to use public commissioning power to specify outcomes rather than rely on market behaviour to deliver them. So, apply Burnham’s own instinct, the why-before-how that runs through everything he has done, to the housing target itself.
Why do we want 1.5m homes? Not as an end in itself. We want them because we believe a country with more homes will be a country with lower rents, lower household costs, more new households forming, fewer people sleeping rough, better physical and mental health outcomes, higher labour market participation, fewer people economically inactive, and a more productive economy overall. The 1.5m figure is a proxy. The actual goal is a set of social and economic outcomes that, if delivered, would compound into a country that works better for everyone in it.
A proxy target can be hit in ways that do not deliver the underlying goal, and missed in ways that do. Three hundred thousand units a year of build-to-rent in city centres at full market rents would technically hit the count and move almost none of the indicators. Fifty thousand council homes a year, delivered with wraparound support in the right places and at sub-market rents, might miss the count by miles and yet be transformative.
The question Burnham should be asked, if he gets to Downing Street, is not “will you stick to 1.5m?” but “what are you actually trying to achieve, and what is the most efficient way to commission it?” His Manchester record suggests the answer is that he is trying to commission homes-as-public-good rather than continue to purchase houses-as-private-asset, and that the most efficient route is for the state to do it directly, through councils, housing associations, and the kind of large-scale public programme he has already pitched.
Houses-as-private-asset is worth pausing on. In Britain, more than almost anywhere else in Europe, families rely on the appreciation of their own home to fund their retirement, their children’s deposits, and their old-age care. That is not a fact of nature. It is a policy choice made repeatedly over 40 years, and it is an aberration by international standards. It also locks the country into a structural contradiction: the same homes that need to be cheaper for the next generation to form households need to be more expensive for the current generation to retire. No volume target can resolve that. Only a different model of how housing is owned, financed and delivered can.
I wrote on the Hope blog recently about how developers should commission architects for the upstream thinking they are trained for, rather than buying the downstream compliance work the market currently prices them on. The principle generalises. We have spent decades buying outputs (units, drawings, permissions, completions) when what we actually wanted was outcomes (places people can live well in, communities that hold, neighbourhoods that improve health and participation). The 1.5m target is the cleanest demonstration of how that logic fails at national scale.
Burnham’s likely premiership is the first real opportunity in a generation to ask whether England wants to keep buying houses-as-product from an industry whose model is profit, or whether it wants to start commissioning homes-as-public-good from a public framework whose job is the country’s wellbeing. The 1.5m target is a useful failure, because it has proved the first option will not deliver. The Manchesterism question is whether Burnham, given the keys, has the courage to drop the unit target, name the actual outcomes, and rebuild the delivery model accordingly.
The number to watch isn’t 1.5m. It’s whatever Burnham puts in its place.
- Phil Cooper is the founder of Hope Architects
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Excellent article. Thank you Place North West for giving the author a platform
By Anonymous
Nailed it! The current system will never deliver as it is. It needs completely changed!
By Anonymous
Really interesting read, thanks
By Jacob
There are too many people in the country. France has the same population but is twice the size. England is choked.
By Anonymous
Given Burnham thinks everyone is living in a cash pile and rolls around in it as their “land value” increases, which he intends to tax, or “capture” as he’d put it, and given that more and more people will be priced out of their homes as they get older and their incomes fall under his plans, no I don’t think there is any hope that he will understand anything.
By John
interesting article
By Anonymous
Just wondering if ‘John’ is going to waddle on to all these threads making things up without a substantive counter argument to his own straw men.
By Northern Monkey
Brilliantly put. A land value tax for developers who land bank (eg Peel Holdings and Pomona island) might help too. Make them either build or sell the land to people who will.
By Anonymous
No mention of how this is all to be paid for. Presumably another tax raid on the already over taxed wealth creating sector
By The Blob
Who will pay for it? The land still needs to be bought. The builders still need to be paid. Housebuilders already operate on such narrow margins that many developments never get off the ground. Why hasn’t the author mentioned that Manchester’s building program has only been made possible by billions in public subsidy?
By Moomo
What a well thought out and reasoned article.
By Mis-manager
The article offers a sharp critique of the UK’s market‑led housing model and I can see the view taken, it makes a strong case for shifting from unit targets to outcome‑based commissioning. But it overstates the coherence of Burnham’s record and underplays the wider structural reasons behind low housing delivery, from planning capacity and infrastructure funding to labour shortages and local political resistance.
The suggestion that Burnham represents the “first real opportunity in a generation” to rethink the system feels more like advocacy than analysis. Meaningful reform will require national political consensus and a willingness to confront the deeper contradictions in how we finance, regulate, and value housing, not just a prime minister with a commissioning instinct.
And as for reshaping the volume housebuilders’ business model, good luck. Their entire financial structure depends on controlling release rates and protecting prices. Without changing the incentives, the outcomes won’t change.
By Steve5839
A lot of analysis here you can’t argue with, but this is all predicated on a “a different model of how housing is owned, financed and delivered can” – a not insubstantial ask! A big ask for any PM, let alone one with 2 years on election clock and basically no financial headroom.
I’d also question the extent to which a commissioning model for homelessness in the GM context can be scaled up to meet a national housing objective. For one thing has Whitehall the nous and capacity?
But to echo previous comments, a welcome piece providing some challenge to the consensu.
By Anonymous
Steve 5839 with another AI effort. If you can’t even bother to try to make it look like your own work, don’t bother. What you should assume though ‘Steve’ is that professionals reading the article understand it without it being run through a computer for laughs. It doesn’t mean they agree with it and anyone with a brain can see what this is, but PNW probably need to do something about this sort of thing. It’s not the first time Steve5839 has provided some AI slop for the comment section.
By Northern Monkey
There’s quite a simple solution to perverse incentives in the house building industry – legislate to de-couple land assembly from house building and ideally nationalise the assembly of land for housing – put the public back in control of the provision of public goods like housing and eliminate ‘hope value’
By Anonymous
Interest rates are back to ‘normal’ after 13 years of being ultra low (2009 to 2022). The extra 3% has increased financing costs by an extra £8k or more which is unaffordable by primary homeowners and unaffordable by renters if passed on. Unless interest rates can be reduced, house building demand will be weak for some years.
By Jack
Worth mentioning in response to @Mammoo, that volume builders operate on a very healthy margin of between 15-25% depending how it’s measured. If they deem the risk of achieving that is too high then they won’t build – simple. That should be the key takeaway from this article which also shines a light on where reform should be – decoupling land trading from house building. (One-off high density urban tower schemes are a different case).
By Anonymous
Burnham hopefully will reform the very unfair council tax. The highest council tax in Westminster, is lower than the lowest rate in Bolton. It has been like this, since John Major was in Downing Street. It needs a total overhaul.
By Elephant
800,000 immigrants per year require 300,000 houses per year
By Mr M Smith
A really excellent article which explains my the motives of volume house builders do not sync with political aspiration of public need.
By John Thornhill
Mr M Smith, please keep up. Net migration was 171,000 people last year nowhere near the figures you quoted.
By Anonymous
Steve5839 – did you actually read the article or just put it through AI to give it a biased analysis?
By Anonymous
@elephant, whilst there is definitely a debate to be had over council tax in general, your information is wrong. A quick google search shows that Band H (the highest) in Westminster is 3917 GBP per year. Bolton band A is 1594 GBP per year.
The main issue with places like Bolton, Nelson etc is that the proportion of people living in Band A properties is generally higher than those in Band D and above, and there will also be a higher % who receive exemptions through benefits. Therefore, the amount collected isn’t as high as say Altrincham and Hale, where the vast majority of properties will be D and above.
By red rose
Great article that hits the nail on the head. Volume housebuilders are not the answer to the housing crisis. They will build as always, to make a profit for shareholders / private equity. We need properly funded public housing. Set up a national housebuilding company with the levers to borrow significant sums of money to build real social and affordable homes as part of mixed use communities across the country. This will pay for itself in the long-term through significant reductions in benefits spending on private landlords and ordinary people who are made poor by rents and mortgages consuming 40%+ of their monthly pay. This can be done in addition to moving the levers to enable SME’s and volume housebuilders to build as well and keep the private market afloat. The economic benefits of this are unparalleled in terms of anything else this Government can do at the minute.
By Anonymous
Andy Burnham has the answer to the problems identified in this article if he does replace current property taxes with a Land Value Tax. Land speculation will stop and idle development sites will be built on, empty and underused buildings will be brought into full use – converting unneeded offices to homes – and land will be more affordable making homes really affordable to rent or buy. Land Value Tax will return publicly created wealth to the public purse to maintain and develop public services including health care and new Council houses. Society creates Land value, not land owners. Andy Burnham has the answer to building more homes for all including the growing number of adults forced economically to live with family because they can’t afford to rent let alone buy a home.
By Heather Wetzel
Heather Wetzel – I agree to an extent but landowners (and indeed developers) do generate value by either putting their land forward for development and/or funding the planning application process which is extremely costly and time consuming. If they didn’t then houses would not be built. Housebuilding is a force for good in general and creates significant public and economic benefits and why should housebuilders not make a profit? It’s odd that the Brits generally have a problem with housebuilders making a profit. Also bear in mind that the number of SME developers has fallen significantly in recent years as the costs and time have spiraled and the ‘risk versus reward’ is no longer worth it. When housebuilders who have been building houses for multiple generations stop building, this should cause alarm bells in Government. The regulatory burden on development has gone too far at a time when the cost of finance and mortgages are prohibitively high. We are entering a phase where there will be many sites with planning permission in 18 months time and no incentive or willingness for housebuilders to build them. This will cause a huge economic problem that will in turn have implications on those who are looking to buy homes.
By Ian
I don’t understand why prefab housing hasn’t become more popular in the UK, the technology, quality and efficiency is so much better than traditional construction and can be manufactured 24/7 regardless of the weather and at higher standards. Prefab or kit houses shouldn’t just be upmarket options such as Baufritz or Hufhaus but could be a cheaper and quicker alternative to providing high quality modern housing at scale.
By GetItBuilt!
Mr M Smith will be another to leave a falsehood in the comments and not to return to either acknowledge and correct it or provide a source for the information. Standard tactic.
By Northern Monkey
In response to Red Rose I lived in Westminster in the 90s. My council tax was £500 a year cheaper than my Mother’s in Oldham. My statistics might be wrong but under no circumstances should someone in Central London be paying less council tax than someone in Oldham.
By Elephant
Great opinion piece.
But to get the public sector to deliver, they will need to massively upskill and be prepared to actually make the hard decisions. They’ll also need to pay the right people to enter the sector and provide the expertise and leadership, too.
By Anonymous