What the Welsh Government needs to do to boost new housebuilding

Director with family-run housebuilder Llanmoor Homes, Tim Grey, on what the Welsh Government should focus on to support much needed new home development

The Plaid Cymru has been in government for more than two months now and its ministers are starting to get to grips with the serious business of running Wales.

The Welsh Government faces a series of challenges more acute than at any time since devolution, with areas like the economy, health and education all demanding urgent attention.

However, one of the key priorities in this Senedd term must be housing. Wales is facing an ongoing housing crisis, with a shortage of homes across all areas of the country, and if the new government doesn’t rise to the challenge, it risks significant damage to the future wellbeing of Wales.

During the election campaign, it was very positive to see broad agreement across all the political parties that more new homes must be built, even if they differed on how to achieve this.

But what wasn’t discussed as much was the importance of open market homes and the role that private sector housing developers can play in this crucial national mission.

Here are some of the issues that must be addressed by the new Welsh Government when it comes to housing:

1. Build more homes for the open market

The reality is that housing supply has not kept pace with demand, and without meaningful intervention this imbalance will continue to affect affordability and access to homeownership.

While social housing targets remain important, they represent only part of the solution. Plaid has already allocated an additional £20m of funding for the delivery of new social homes in its supplementary budget (though as it lost the vote it remains to be seen what happens with this). Increasing the supply of high-quality open market homes must sit alongside these ambitions if the overall housing challenge is to be addressed effectively.

Delivering this will require a more streamlined and responsive planning process, supported by a pro-development mindset across both the Welsh Government and local authorities. Housing should be recognised not as a constraint, but as a catalyst for sustainable economic growth and stronger communities.

2. Fix the planning system

The current planning system in Wales is not operating as efficiently as it needs to. Securing consent for developments can take significant time and often involves unnecessary complexity, in part due to under-resourced local authority planning departments.

Plaid pledged to reform planning in its manifesto, including giving communities more power over development and review the use of Section 106 agreements.

While we wait to see what this looks like in practice, there is a clear need to reduce barriers and create a more supportive environment for delivering new homes. A key priority should be the widespread adoption and timely updating of Local Development Plans (LDPs), providing greater certainty for development over the medium to long term.

Where land has already been allocated for housing within an LDP, there should be a clear presumption in favour of development. Providing this level of clarity would help unlock sites more quickly and ensure that opportunities to deliver new homes are not unnecessarily delayed.

3. Support small and medium-sized housebuilders

The number of SME housebuilders operating in Wales has declined significantly in recent decades, reflecting the growing challenges smaller firms face. Rising costs, complex regulation and barriers to accessing finance have all contributed to a more concentrated market.

A less diverse housebuilding sector risks limiting both the pace and the variety of homes being delivered. Smaller developers often play a vital role in bringing forward sites that larger firms may overlook, as well as responding more directly to local housing needs.

Supporting SMEs through improved access to finance, proportionate regulation and incentives for smaller site development would help restore balance to the market and increase overall delivery. A more diverse sector is not only economically beneficial but essential to meeting Wales’s housing needs.

Taken together, these issues highlight the scale of the challenge, but also the opportunity facing the new Welsh Government. With the right policy framework, a more efficient planning system and a commitment to supporting the full breadth of the housing sector, meaningful progress can be made.

Housing is not simply one policy area among many. It underpins economic growth, social mobility and the overall wellbeing of communities across Wales. Addressing the housing crisis must remain a central priority in this Senedd term, with sustained focus and collaboration between government and industry to deliver the homes the country urgently needs.

• Tim Grey is sales director at Pontyclun-baed Llanmoor Homes.