Against the Odds: Why UK Developers Are Defying Gloom and Backing a Housebuilding Boom

• Three in five developers are confident that the UK will meet the Government’s 1.5m new homes target in the next five years 
• 64% of property developers said they expect there to be an increase in housebuilding in the short term
• This optimism comes despite construction activity falling in 2025 and wider market scepticism around the targets 

A significant number of property developers surveyed within the UK are confident that the UK can meet the housebuilding targets set by the Government, finds new research from Shawbrook*. 

In the last year the Government has introduced several measures to accelerate housebuilding. These include planning reforms such as mandatory housebuilding targets for councils, grey belt policies, the recruitment of 300 new planning officers, and golden rules for development. According to Shawbrook’s findings, these initiatives are boosting confidence among property developers.

Analysis of the data reveals that two-thirds (64%) of developers expect housebuilding to increase in the short term (within 12 months). However, confidence dips in the medium term (1–3 years), with just over half (51%) anticipating growth, and remains similar in the long term (3–5 years) at 52%.

This optimism may stem from the new Government’s target to build 1.5 million homes over the next five years. When asked about the likelihood of achieving this goal, three in five (59%) developers believed it would be easy, while 41% acknowledged it could be challenging. This comes against the backdrop of recent S&P Global UK Construction PMI figures, which recorded the sharpest decline in construction output since May 2020, driven by weak demand and broader economic concerns.

A third (33%) of developers pointed to the lack of support for first-time buyers as a major barrier to homeownership, while an equal proportion felt the UK’s infrastructure—such as roads, railways, schools, and hospitals—was insufficient to support new developments.

Resource availability is another key concern among developers. Nearly a third (29%) believe there isn’t enough funding to support developers, while 28% feel there is insufficient land in high-demand areas. An equal proportion (28%) are worried that there aren’t enough resources to meet the level of building required.

Terry Woodley, Managing Director of Development Finance at Shawbrook, commented:

"While the developers we spoke to are confident, scepticism remains more broadly in the market. There has been some progress over the past year in reducing planning red tape and streamlining processes, but more needs to be done to make the 1.5 million new home target feel more achievable. Resource constraints remain a major challenge—whether in the form of materials and supply chain issues or the sector’s ongoing skills shortage. To truly unlock the UK’s housebuilding potential, the Government should make addressing these issues a priority."

^Methodology

^{*Research was conducted by Censuswide between 06.02.2025 and 24.02.2025, surveying 568 property developers aged 18+ across England, Wales, and Scotland.}