New research from the Home Builders Federation (HBF) reveals £76,000 has been added to the cost of building a home since 2020, which the organisation says raises serious concerns about the viability of new housing developments across the UK.
The report, The Viability Crunch, examines the cumulative impact of policy, taxation and regulatory pressures on home building and highlights a sharp downturn in recent housing delivery. Just 208,000 new homes were completed in 2024/25, down 16% from the 2020 peak, which HBF says was driven in large part by worsening development viability.
The estimated additional £76,000 cost to build per home is made up of more than £7,000 in taxes and levies, including £2,000 in landfill tax, £2,320 from the forthcoming Building Safety Levy, £2,055 in other taxes and £985 from inflationary increases on existing charges such as Section 106 agreements.
Over £23,000 has been added in regulatory costs, including £7,770 for building regulations, £5,700 for Biodiversity Net Gain (BNG) and £10,200 in costs linked to the Future Homes Standard, with £37,000 in increased material and labour costs due to high levels of inflation, and £7,000 in additional potential site-specific costs.
The increase represents over 20% of the average new home value of £365,000 as of June 2025, HBF said.
HBF is calling on the government to implement a moratorium on new policy costs, taxes and levies affecting home building and to conduct a comprehensive review of cumulative regulatory impacts. “This should include a cancellation of the Building Safety Levy currently scheduled for October 2026, given billions already contributed to building safety and more than £2.5 billion remaining unallocated in the existing Building Safety Fund,” the organisation said.
It is also asking the government to suspend further increases to the landfill tax, which doubled in April 2026 and is planned to rise every year until 2030.
Neil Jefferson, chief executive at the Home Builders Federation, said: “The government’s ambition for new homes relies heavily on private home builders to deliver, yet it is not providing the conditions for these businesses to operate.
“While the industry supports the ambition behind some of these policies, there has been little consideration of their combined impact. The fact that house completions have remained slow clearly shows that planning reform alone is not enough and that other pressures are at play.
“Reforming the planning system and reintroducing housing targets for local authorities was a vital first step in boosting supply but doing so while layering on more taxes, levies and policy costs is akin to having one foot on the accelerator and the other on the brake.
“If government wants the private sector to deliver, it must create the right conditions for it to do so. Without urgent action to review and reduce the overall cost burden, the delivery of both private and affordable homes will remain at risk, and people will continue to miss out on the homes they need.
“Increased taxes and policy costs, alongside suppressed demand due to a lack of affordable mortgage lending and no government support for buyers, are preventing builders increasing housing supply and putting the government’s housing ambitions increasingly out of reach.”
