🚨 What’s Happening?
In 2025, Basel 3.1 rules will hit UK banks.
They force banks to treat housing development loans as ultra-risky, meaning:
- Higher capital = more expensive loans 💸
- Shorter terms = fewer viable projects 🧱
- Less lending = fewer homes built 🏚️
📉 Estimated Impact:
🚫 20,000–25,000 fewer homes per year
(Source: UK Finance, BPF)
And guess what?
The developers who survive this? The big ones.
Everyone else? Crushed.
❌ Why It’s Worse in the UK
- We scrapped our regional planning system (RDAs)
- LEPs have no planning or funding powers
- Local councils are left to fend for themselves
- There’s no one to coordinate infrastructure, de-risk sites, or back SME builders
👉 Basel 3.1 hits a broken system — and will break it further.
🛠️ What Needs to Happen — Now
1️⃣ Fix Basel for Housing
✅ Carve out housing loans from harsh Basel rules
✅ Apply lower risk weights for SME, affordable, and regeneration loans
✅ Recognise housing as essential social infrastructure
2️⃣ Create a National Housing Delivery Bank
✅ Low-interest loans for builders shut out of Basel lending
✅ Risk-sharing for land, brownfield, and infrastructure
✅ Prioritise SMEs, co-ops, self-builders, and local delivery
3️⃣ Restore Strategic Planning
✅ Reintroduce statutory regional planning powers
✅ Let Combined Authorities coordinate housing + infrastructure
✅ End the planning chaos and give banks confidence to lend long-term
4️⃣ Protect Developer Diversity
✅ Reserve land for SMEs, community-led, and innovative builders
✅ Make funding and planning accessible by design
✅ Break the monopoly of 10 volume housebuilders
📌 Final Message to Policymakers
If you don’t act, Basel 3.1 + a broken planning system = a housing collapse in slow motion.
You’ll get:
- Less housing
- Worse housing
- Fewer builders
- Bigger developers with all the power
👉 This isn’t reform — it’s regression.
🛑 Fix it now, or own the crisis later.