EXCLUSIVE šŸ—žļø- Britainā€™s economic watchdog, the OBR, is concerned that it may have to revise down the boost to GDP it had attached to Labourā€™s flagship planning reforms and 1.5 million new homes target. The OBR has invited housing market experts in for meetings in a bid to ā€œunderstand why the housing market is underperformingā€ so badly. This will be a blow to the government and signals the state of our housing market amid worsening economic headwinds including inflation and higher mortgage rates which, in their defence, are neither Labourā€™s fault nor entirely within their control. It also raised questions about the OBRā€™s initial forecast which experts have told me was optimistic at best. My report @theipaper inews.co.uk/news/hidden-costā€¦

The hidden cost of Labour's failing 1.5m housebuilding target is about to get worse

Britain's economic watchdog is concerned that its assessment of Labour's housebuilding plans may need to be revised down

inews.co.uk

Last edited Sep 20, 2026 Ā· 4:17 PM UTC

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Replying to @Victoria_Spratt
Many eyebrows were raised at the time when this speculative boost was included by the OBR in its numbers whilst the all too tangible headwinds of the 330 page, red tape 'Unemployment Bill' - then in the concluding stages of its journey through Parliament - was not.
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Replying to @Victoria_Spratt
@alexgroundwater the OBR is inviting housing market experts in to help them understand why itā€™s underperforming so badly. Given that our housing market analysis is ranked alongside and even above the FT and Economist, do you think we should offer our insights? As in, even if they did listen to us would it make any difference? I mean thereā€™s not much to lose. I think a lot of people would benefit if the OBR understood housing well enough that they didnā€™t have to keep downgrading their original forecasts. Iā€™m up for it if you are! šŸ’ŖšŸ¼ (I suspect hell will have to freeze over first but weā€™ve been invited in by other gov departments so itā€™s not impossible!)
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Replying to @Victoria_Spratt
OBR too optimistic? Surely notā€¦.
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Replying to @Victoria_Spratt
Invite housing market experts in! Lol 1) Interest rates are too high. 2) Build costs have almost doubled since Covid. 3) There is stupid and laborious regulation everywhere you look - from bat surveys to huge delays in the planning system.
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Replying to @Victoria_Spratt
Government's target of 1.5 million net additional dwellings in 5 years in England alone was not realistic when government came to power in July 2024 & clearly it is even less realistic now. 0.94 million is more realistic. (1/2)
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Replying to @Victoria_Spratt @MarketBlondes
ONS - ignore our figures we know they are wrong OBR - hold my beer This is banana republic levels of data analysis, except in this case it is incompetence rather than design
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Replying to @Victoria_Spratt
Inflation, mortgage rates, employment are all Labourā€™s fault through tax borrow spend and more cost/ regulation on wages. But more importantly the collapse in housing starts is exactly Labourā€™s fault - Rebters rights act, high taxes, high net zero surcharges - total mess
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Replying to @Victoria_Spratt
The housing market is underperforming because it is based on reality and not a Labour Party manifesto aimed at the terminally gullible
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Replying to @Victoria_Spratt
No surprise here. OBR Isnā€™t fit for purpose.
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Replying to @Victoria_Spratt
If the OBR has to ask that question abolish the OBR
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Replying to @Victoria_Spratt
Why does it need experts in? All people with half a brain have been saying this will happen for years. All they need is common sense ā€¦ which unfortunately, isnā€™t to common in the Labour Party
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Replying to @Victoria_Spratt
So stifling the economy, raising the welfare bill and taxing the crap out of every working person is not the governmentā€™s fault? A stronger economy would possibly make these headwinds less of a problem?
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Replying to @Victoria_Spratt
1) Increased energy costs 2) Increased labour costs 3) Increased levies to fund social housing 4) Increased stamp duty 5) High mortgage rates You do not need experts to work out that labour tax rises have attacked the construction and housing sector into recession.
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Replying to @Victoria_Spratt
The House Building Federation have already done this back in May. hbf.co.uk/news/new-taxes-andā€¦
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Replying to @Victoria_Spratt
Labour donā€™t understand private enterprise so there is no earthy chance they can fix this
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Replying to @Victoria_Spratt
I wonder why? Lets take one example; there is a concept and rules around something called "biodiversity net gain" which has to be satisfied. Do we really need any further analysis?
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Replying to @Victoria_Spratt
Since when has the OBR ever produced an accurate forecast ? Theyā€™re a complete joke and no credibility should ever be given to what the put out šŸ¤·ā€ā™‚ļø
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Replying to @Victoria_Spratt
The 1.5 million homes not existing would indeed affect the forecast. Genius minds at work
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Replying to @Victoria_Spratt
Why is it underperforming? Landbank profiteering.
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Replying to @Victoria_Spratt
1) Huge increases in taxation around building. 2) Inflation of build costs 3) We are 3-4 years away from peak Boomer deaths. Meaning increasing numbers of large homes are entering the market. The above means new house building is not profitable in around half of the country. mortgagestrategy.co.uk/news/ā€¦

Building homes not financially viable across half of England: Zoopla

Building homes is not currently financially viable across half of England, Zoopla has claimed.Ā  That is because its analysis found that the cost of

mortgagestrategy.co.uk
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Replying to @Victoria_Spratt
Why had they attached any figure to Labour's proposal? Surely they should wait to see how realistic any such proposal is before attaching a figure to it!
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Replying to @Victoria_Spratt
London house building is through the floor due to new regulations.
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Replying to @Victoria_Spratt
Not Labour's fault? - Employers NICs - offshoring energy - culling cement, steel etc industries for net zero - crashing the house market by * cost of living crisis & increased taxation - people fear increased mortgage rates * fear or reality of unemployment
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Replying to @Victoria_Spratt
Yep they think low skill immigration and huge public sector projects given to overseas contractors improves growth
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Replying to @Victoria_Spratt
1.5 million was a stooooopid target simply because.. Water supply. Electricity Sewage treatment Hospitals Prisons Roads. Easier re migration to solve the problem!
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Replying to @Victoria_Spratt @greenarteries
To be fair house building perse doesnā€™t improve economic growth for people in particular areas - especially if growth is based on poor employment, low skills and lagging deliverable support services. Itā€™s time to be clear about good growth & what a middle ranking economy means
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Replying to @Victoria_Spratt
Maybe the OBR should have invited House builders in BEFORE the Gov made its 1.5m pledge & ask what conditions were needed to build the new homes.
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Replying to @Victoria_Spratt
ā€¦.so the OBR are confirming their internal models that they used so far to aid the forecasts might be wrong because they are asking people inā€¦. ā€œto understand why the housing market is underperforming so badlyā€ Wow šŸ˜‚ #ukpolitics #obr
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Replying to @Victoria_Spratt
@moving_charlie @RaoulRuparel I think there was a major policy change as interest rates rose - the introduction of Consumer Duty and believe that is an policy needing scrutiny. Attracted to it as a supplement to the necessary prudence rules brought in after GFC. @cecrowther
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Replying to @Victoria_Spratt
They need experts to explain this to them? Massivlet increasing taxes, regulation and ataff costs have skull fucked house building. All while they say they will tax property owners in the future.
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Replying to @Victoria_Spratt
Maybe sellers should drop their prices from the current delusional levels.
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Replying to @Victoria_Spratt
Their entire economic project is a dysfunctional lie! They tell us we are the fastest growing economy in the G7, yet that growth is purely from AI! The traditional sectors that create jobs are collapsing due to NIC, new taxes, more legislation! 240,000 jobs lost since 2024!
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Replying to @Victoria_Spratt
The OBR discovering that forecasts built on government targets are bs. Colour me shocked šŸ˜‚ I'd love to sit in on those meetings, bet the mood is grim.
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Replying to @Victoria_Spratt
Forecasting organisation in got it wrong again shock!
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Replying to @Victoria_Spratt
Well spotted Vicky ā€¦ as an architect I can tell you that massive headwinds have closed off most house builders forward order books and Labour are seriously out of luck
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Replying to @Victoria_Spratt
[ shakes head ] [ shakes it some more ] How can our country's management be so dim? Affordable, ffs. Affordable. A tonne of houses on green field sites being built round here. You can see construction slowing, because they're not selling at the rate expected. Over supply.
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