The new housing secretary is under mounting pressure after Britain’s largest homebuilder and other developers reported falling completions, a development that complicates Labour’s pledge to deliver 1.5 million new homes in this Parliament.
Barratt Developments, the FTSE 100 housebuilder, will this week report it completed 16,565 homes in the 12 months to June 29, down from 17,972 in the previous year, while rival Vistry said it built 6,889 properties in the first six months of 2025 compared with 7,792 in the same period before the general election. Official data show housebuilding is at its lowest level since 2016 outside the pandemic.
Labour set a target of 1.5 million new homes — about 300,000 a year — to be delivered during the parliamentary term. The programme was overseen by Angela Rayner when she served as deputy prime minister and housing secretary; Rayner was removed from the post earlier this year after an inquiry found she had failed to pay sufficient tax on a second home. Steve Reed succeeded her and has urged officials to accelerate building, adopting the slogan "build, baby, build" and saying he wanted to "unleash one of the biggest eras of building in our country's history."
Despite those aims, housebuilders have flagged headwinds. Barratt set an internal target of 17,200 to 17,800 homes for the current year, still below its 2023–24 output. Vistry and other firms pointed to uncertainty over possible property taxes and policy changes ahead of the government’s Nov. 26 Budget as a factor weighing on orders and planning decisions. Vistry executives said hesitation among buyers and investors caused by tax uncertainty was already affecting activity.
Market conditions have compounded the problem. The Bank of England is widely expected to hold Bank Rate at 4 per cent at its meeting this week, and analysts at HSBC wrote that further rate cuts are unlikely before April 2026. Higher-for-longer borrowing costs reduce mortgage affordability and may suppress demand for new homes, developers and market watchers said.
"Given the slow start towards the 300,000 homes per year hurdle rate and continuing affordability pressures for buyers, the chance of reaching the 1.5m new homes target looks slim at best," Aarin Chiekrie, a strategist at Hargreaves Lansdown, said.
Separately, ministers and industry officials have warned of a slowdown in planning approvals and contract awards, which delays when construction can start. Reed last week said parts of his agenda were at risk after a slump in approvals and contracted work, remarks that underline the practical and financial barriers developers face when trying to scale up output quickly.
The shortfall in completions comes as the government prepares a suite of housing measures intended to boost supply and tackle affordability. Officials will point to planning reforms, incentives for institutional investment in build-to-rent and proposals to unlock public land for development as tools to raise delivery, but builders say such measures take time to translate into homes on the ground.
Analysts and executives said the near-term outlook hinges on three elements: the Bank of England’s interest-rate path, clarity from the Treasury on tax and planning policy in the November Budget, and the pace at which stalled approvals and contracts can be restarted. Until those matters are resolved, reaching an average of 300,000 new homes a year will remain a significant challenge for the housing secretary and the government.
Ministers are due to receive further industry updates and official housing statistics in the coming weeks, which will be used to assess progress toward the target and shape policy announcements ahead of the Budget.