RSM UK has urged the Government to review planning policy and tax measures to improve the viability of residential developments, warning that current conditions are undermining housing delivery.
In an open letter to housing minister Matthew Pennycook, the firm called for a series of reforms, including the reintroduction of Multiple Dwellings Relief (MDR), which was scrapped in 2024, to help stimulate investment and accelerate housebuilding.
The intervention follows new research from RSM’s Real Estate 360 report, which found rising costs and planning delays are now the biggest barriers facing developers.
According to the survey of more than 270 real estate leaders, 39% said development costs are the primary obstacle to meeting housing targets, while 26% pointed to planning challenges.
TARGETED INTERVENTION
Confidence in the Government’s ability to deliver its 1.5 million homes target by 2029 also appears to be weakening, with 58% of respondents saying they do not believe the target will be met.
The findings highlight growing concern across the sector that current policy is not doing enough to support delivery at scale, with calls for more targeted fiscal intervention and faster planning processes.
Stacy Eden (main picture, inset), Partner and National Head of Real Estate at RSM UK, says: “Short-termism and a piecemeal approach to increasing housing supply is currently holding the industry back.
“That’s why we’ve called for greater urgency and for the Government to reconsider policy and tax reform.
“We’re asking for government to work with the sector to continue to streamline the planning process, remove unnecessary red tape and reduce taxes on the industry, speeding up Gateway 2 approvals.
“Reconsidering abolished tax relief will also be a good start in stimulating the market, in desperate need of some injection to ensure developments become more viable.”
DEVELOPMENT CHALLENGE
Melanie Leech, Chief Executive of the British Property Federation, adds: “RSM’s report echoes what BPF members have been saying for many months – despite the Government’s best intentions and some welcome planning reforms, development viability is severely challenged across the country.
“Recent announcements such as the next wave of New Towns will take some time to gear up – in the meantime the development industry needs Government to take urgent measures on the cost of building to unlock homes and commercial space.
“One immediate action that would support new homes would be the reintroduction of a form of Multiple Dwelling Relief, which would be a shot in the arm for Build-to-Rent developments, in turn unlocking viability for lager housing sites.”
