Wales Confronts Significant Housing Delivery Challenge
According to a comprehensive new analysis from planning and development consultancy Lichfields, Wales may need to deliver more than 10,600 homes each year over the next five years to align with the Welsh Government's latest housing need figures on a comparable basis. This assessment underscores a substantial gap between current delivery rates and projected requirements.
Government Estimates Versus Actual Delivery
The Welsh Government's updated housing need estimates, published in February, identify a central requirement of approximately 8,700 homes per year between 2025 and 2030. This figure already represents a significant increase above recent delivery levels, with housing completions averaging around 5,000 homes annually and only 4,631 delivered in the 2024/25 period.
However, Lichfields' review indicates that the methodology for presenting these new figures differs from the approach used in 2019. The latest estimates separate newly arising need from the existing backlog of unmet need, which is currently identified as 9,400 households. In 2019, this backlog was integrated into the first five years of the plan period.
Comparative Analysis Reveals Higher Requirement
If the same 2019 method were applied to the new dataset, the annual requirement for 2025–2030 would equate to 10,620 homes per year. This represents a 43% increase on a like-for-like basis, highlighting the scale of the challenge facing housing delivery in Wales.
The updated figures also suggest a shift in the balance of housing required. For the next five years, the central estimate indicates around 65% market housing and 35% affordable housing, reflecting evolving demographic and economic needs.
Expert Calls for Planning Policy Reform
Gareth Williams, senior Director at Lichfields, emphasized the urgency of the situation. "Even the central estimate of 8,700 homes a year represents a significant uplift on recent delivery. On a comparable basis with the previous methodology, the annual requirement would exceed 10,600 homes," he stated.
"That gap between identified need and actual delivery is substantial. There is an urgent need for planning policy reform to ensure continuity of housing delivery where Local Development Plans are failing to progress. In our view, this should be a priority for whichever party forms the next Welsh Government after the May elections," Williams added.
Minimum Estimates and Future Implications
The analysis further explains that the published estimates should be viewed as a minimum, given the way they have been calculated. This suggests that the actual housing need could be even higher, compounding the delivery challenge.
Arwel Evans, planning director at Lichfields' Cardiff office, provided additional insight. "The latest household projections will form a key part of the evidence base for regional and local development plans. Authorities bringing forward new or revised plans will need to consider these figures carefully," he noted.
"If Wales is to move closer to meeting identified need, there will need to be confidence in land supply, up-to-date plans and a consistent policy framework to support delivery," Evans concluded, outlining critical factors for addressing the housing shortfall.
