Major housebuilders are ceasing investment in London due to a "nightmare" of planning objections that render developments unviable. Berkeley Group, a prominent developer, warned that the current planning environment jeopardizes the delivery of new homes and could increase pressure on greenfield sites.
The withdrawal of major housebuilders from London due to planning hurdles threatens the delivery of new homes, potentially exacerbating the housing crisis and increasing pressure on undeveloped land.
Top housebuilders are withdrawing investment from London, citing a "nightmare" of planning objections that have made developments unviable. Berkeley Group, one of Britain's largest housebuilders, issued a warning that the current planning environment is hindering new investment in the capital and potentially worsening the housing crisis.
The company's concern was amplified after a planning inspector rejected proposals for 867 homes in Peckham for a second time. Despite the inspector acknowledging the scheme's potential to address housing shortages and deliver broader social and economic benefits, the decision was made based on the impact on nearby heritage assets outweighing the scheme's advantages.
Rob Perrins, Executive Chair of Berkeley Group, stated that such rejections make it impossible for developers to justify investing in new London sites. He questioned how ministers expect developers to meet housing targets if regeneration schemes on allocated brownfield land are consistently blocked, suggesting this could lead to increased pressure on greenfield and Green Belt land.
Conversely, Sarah King, Leader of Southwark Council, welcomed the planning inspector’s ruling, asserting that local concerns regarding the design had been validated. The situation comes amid broader concerns about a significant decline in housebuilding activity in London, with industry figures indicating just over 2,100 residential starts in the first quarter of 2026, falling far short of government housing targets.
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