Guidance

Housing Delivery Test: 2023 measurement technical note

Published 12 December 2024

Applies to England

Introduction

This document sets out the technical process followed in order to calculate the 2023 Housing Delivery Test measurement in line with the published Housing Delivery Test rule book.

This document should be read alongside the Housing Delivery Test rule book and aims to explain how this year’s result is calculated with a step-by-step explanation of the process as opposed to setting out the policy in detail.

All terminology in this document mirrors that contained in the Housing Delivery Test rule book.

The Housing Delivery Test measurement is published annually by the department. The Housing Delivery Test period covers the previous 3 financial years; in the case of the 2023 measurement, the years are 2020/21, 2021/22 and 2022/23.

The Housing Delivery Test compares the net homes delivered over 3 years to the homes required over the same period.

Housing Delivery Test (%) =

Total net homes delivered over 3 year period

divided by

Total number of homes required over 2 year 8 month period*

*For the 2023 measurement, there is a reduction in the period for measuring total homes required – usually this would be measured over a 3-year period, but an 8-month period has been used for the 2020/21 monitoring year; requirement is assessed from 1 August 2020, meaning that 243 days are assessed. This is to account for the considerable variations in levels of housing delivery as local planning authorities and construction industry faced disruption on a national, regional, and local level due to the pandemic. No adjustment was made in the 2021/22 and 2022/23 monitoring years.

The calculation uses published statistics and data collected by the department from local planning authorities, National Parks, and Development Corporations for this purpose.

Calculating the homes required

To calculate the total net homes required over the 3-year monitoring period, the calculations draw on:

• Local housing need. This is calculated in line with the Housing and Economic Needs Assessment Planning Practice Guidance. In order to calculate the minimum annual housing need figure using the standard method, MHCLG use the following inputs:

  • The projected average annual household growth over a 10-year period based on 2014-based household projections for all test years.

  • For the 2020/21 measurement year, adjustment for affordability using the 2019 affordability ratio published 19 March 2020. For the 2021/22 measurement year, adjustment for affordability using the 2020 affordability ratio published 25 March 2021. For the 2022/23 measurement year, adjustment for affordability using the 2021 affordability ratio published 23 March 2022.

  • An appropriate cap based on the local authority’s plan status on 1 April 2020 for the 2020/21 measurement year, on 1 April 2021 for the 2021/22 measurement year, and on 1 April 2022 for the 2022/23 measurement year (where applicable).

  • From the 2022/23 measurement year the cities and urban centres uplift within the standard method applies.

• Local plan information^{[footnote 1]} from both the most recent local plan and the previous local plan. Only local plans that set out an authority’s housing requirement are used^{[footnote 2]}. Data collected includes: the adoption date, start date, end date, housing requirements including trajectories, joint plan requirements, traveller requirements, any unmet need which has been given to or taken from other authorities, and whether the plan has been reviewed and the outcome of this review (see Plan Reviews).

• Current London Plan annual averages 2019-2029^{[footnote 3]}.

• Plan Reviews – In order to determine whether a plan review^{[footnote 4]}, that concludes that policies do not require updating, has been satisfied for the purposes of the Housing Delivery Test, the authority must have^{[footnote 5]}:

  • Published an assessment of the strategic housing requirement policy (or policies) within 5 years of adoption of such policies; and

  • As part of the review concluded that such policies do not require updating.

Given the wide-ranging status and characteristics of local plans across England, the exact process to calculate results varied. The below sets out the steps taken for all authorities and then goes through individual steps taken contingent on the plan status and characteristics which affect the application of the Housing Delivery Test.

For every local planning authority, the following steps were taken:

1. For every local planning authority, the standard method is used (as set out above) in all test years.

2. Net unmet need is calculated for each authority by summing all the need taken (the authority becomes responsible for delivering this housing) and taking away all need given (the authority is no longer responsible for this housing).^{[footnote 6]}

3. To convert this into an annual figure, the number of years the plan covers is calculated by taking the difference between the start date of the plan and the end date of the plan, by classifying both the start date and end date as days the plan covers. The total net unmet need figure by authority is then divided by the total plan period. If a local planning authority does not have its own local plan adopted, the plan period of the local planning authority it shares need with is used. If a local planning authority does not have its own local plan adopted and there are more than two partners in the need sharing agreement, the period in the most recently adopted plan in the group is used for the local planning authority/authorities without a local plan adopted.

4. The annual net unmet need for each authority is then added to local housing need. If none of the local planning authorities sharing unmet need agreement have an updated local plan adopted, the need transfer is not applied from the point at which the last plan becomes ‘out of date’.

5. In some cases, local housing need may be negative for one or more of the years being tested. In these instances, all 3 years (including negative values) are summed. If the 3-year summed result is a negative value, this is set to zero. If the sum of the 3 years is positive (despite one or more negative years), the figure is not changed.

In addition to steps 1 to 5, for an authority without an ‘up to date’ ^{[footnote 7]} local plan the following steps were taken:

6. The housing requirement is based on the local housing need, plus unmet need figure set out in an adopted plan (as calculated in steps 1 to 5 above) for each year. Since there is no ‘up to date’ local plan, the ‘lower of’ policy does not change the total number of homes required. The exception to this is where the authority is covered by a Spatial Development Strategy (SDS) (see ‘London Boroughs’).

In addition to steps 1 to 5, for an authority with an ‘up to date’ local plan for the entire Housing Delivery Test period the following steps were taken:

7. The ‘homes required’ figure is based on the annual average from the most recent plan for each year. If the local plan includes a stepped requirement, then the annual average from the stepped requirement corresponding to the relevant period is used.

8. The number of homes required each year is based on the lower of the housing requirement in local plans or local housing need plus unmet need. This is carried out for each of the 3 years.

9. The final number of homes required sums each year’s lower figure to calculate the 3-year total number of homes required.

In addition to steps 1 to 5, for an authority with a plan which is partially ‘up to date’ during the Housing Delivery Test period the following steps were taken:

10. The ‘homes required’ figure is based on the annual average from the most recent plan for each year. If the local plan includes a stepped requirement, then the annual average from the requirement corresponding to the relevant period is used, and the steps below are applied in the same way.

11. If the plan becomes ‘out of date’ then from this point onwards the housing requirement is based on local housing need plus unmet need depending on the test year.

12. If the plan becomes ‘out of date’ midway through a year, a weighted average for that year is calculated. This means that for as many days that the plan was ‘up to date’ within a test year, the annual average is used. For the remainder of the year, local housing need plus unmet need is used.

13. The number of homes required each year over the 3-year period is based on the ‘lower of’ the housing requirement or local housing need plus unmet need for each year.

14. In this instance, the housing requirement in a given test year could be:

a. The annual average from the plan (if the plan is ‘up to date’ for the full year).

b. A weighted average of the annual average from the plan and local housing need plus unmet need (if the plan is only ’up to date’ for part of the year).

c. Local housing need plus unmet need (if the plan is ‘out of date’ for the full year).

15. For each individual year that the annual target is greater than unmet need, or the local housing need plus unmet need, the lower figure is used.

16. The final number of homes required sums each year’s lower figure to calculate the 3-year total number of homes required.

17. Similar to the above, if an authority adopts a plan which covers the latter part of the Housing Delivery Test period (then prior to the period the plan covers), local housing need plus unmet need is used. From the point following the plan start date, the housing target from this is used (using the relevant stepped requirement where appropriate). The ‘lower of’ policy is applied in the same way, comparing the housing requirement in each year to local housing need plus net unmet need.

In addition to steps 1 to 5, for an authority with a previous plan which was ’up to date’ for part of the Housing Delivery Test period and whose current plan was ‘up to date’ for part of the Housing Delivery Test period, the following steps were taken:

18. If the previous plan is ‘up to date’ for part of the Housing Delivery Test period, but the current plan start date encompasses the Housing Delivery Test period that the previous plan covered, the most recent plan is used and the previous plan is not.

19. If the previous plan is ‘up to date’ for part of the Housing Delivery Test period and this period does not overlap with the current plan, then the previous plan is used for as long as it is valid. After this period, the most recent plan is used.

20. If there is a period where there is no plan, then local housing need plus net unmet need is used for this period.

21. Where the periods above do not align with a test year, a weighted average for that year is calculated. This means that, for as many days that the previous plan was ‘up to date’ within a test year, the annual average from that plan is used. For the remainder of the year, either the current plan or local housing need plus unmet need (depending on the status of the current plan) is used.

22. The ‘lower of’ policy for each year is applied based on the housing requirement and local housing need plus net unmet need. The final number of homes required sums each year’s lower figure to calculate the 3-year total number of homes required.

In addition to steps 1 to 5, for a London borough including Development Corporations with full plan making and decision-making powers, the following steps were taken:

23. London Boroughs are treated the same as other authorities except, where there is no ‘up to date’ local plan, the most recently adopted London Plan annual average^{[footnote 8]} is deferred to. In the instance where the London Plan becomes over 5 years old, local housing need was used as the basis of requirement. If a new London Plan is adopted / published, the new adopted housing requirement will apply from the start of the relevant plan period (as set out in the strategic policies for housing), which may be earlier than the adoption of the strategic policies. If a London Borough has a previous plan that was ‘up to date’ for part of the Housing Delivery Test period, then this plan is used for the period it applies.

24. If the borough plan becomes ‘out of date’ midway through the year, a weighted average for that year is calculated. This means that, for as many days that the plan was ‘up to date’ within a test year, the annual average is used. For the remainder of the year, the annual borough average from the London Plan is used.

25. Similar to step 24, if the borough plan and London Plan both become ‘out of date’ part way through the year, the requirement for the remainder of the year is local housing need plus unmet need.

26. If the borough plan includes a stepped requirement, the annual average from the requirement corresponding to the relevant period is used, and the steps above are applied in the same way.

27. The number of homes required each year over the 3-year period is based on the ‘lower of’ the housing requirement or local housing need plus unmet need in each year.

28. In this instance, the ‘homes required’ figure in a given test year could be one of the following:

a. The annual average from the borough plan (if the plan is ‘up to date’ for the full year).

b. Annual borough average from the ‘up to date’ London Plan (if the borough plan is not ‘up to date’ for the full year).

c. A weighted average of the average from the borough plan and annual borough average from the current London Plan (if the plan is only ‘up to date’ for part of the year).

d. A weighted average of the annual average from the previous boroughs plan and the weighted average from the current borough plan (if the previous plan is ‘up to date’ for part of the period, and the current borough plan follows directly from this, or its plan period predates the expiry of the previous plan).

e. A weighted average of the average from the previous borough plan and the annual borough average from the current London Plan (if the previous plan is ‘up to date’ for part of the year and there is no current borough plan to cover the rest of the test year period).

f. A weighted average of the annual average from the previous borough plan, the borough average from the current London Plan and the average from the current borough plan (if the previous plan is ‘up to date’ for part of the period, the current borough plan follows indirectly from this meaning the London Plan is relied on in the interim period).

g. A weighted average of the average from the previous borough plan, the current borough plan, the current London Plan, and then local housing need; if the previous borough plan, current borough plan and London Plan are all ‘out of date’ for part of the period, then local housing need is relied on to cover the rest of the test period.

29. The final number of homes required is the sum of each year’s lower figure to calculate the 3-year total number of homes required.

30. The London Legacy Development Corporation’s and Old Oak and Park Royal Development Corporation’s housing requirement is based on its local plan or London Plan annual average in the same way as other London boroughs. Given there is no separately published local housing need, the ‘lower of’ policy is not applied. Therefore, the housing requirement from their local plan is their final number of homes required.

In addition to steps 1 to 5, for authorities covered by a joint plan with a joint requirement the steps below were taken:

31. Where authorities have an ‘up to date’ joint plan and are being measured jointly for the purpose of the Housing Delivery Test, the housing requirement set out in the joint plan is used.

32. If the joint plan becomes ‘out of date’ during the test period, then a weighted average for the year is calculated; using the joint plan annual average housing requirement up to this point and from then onwards the total local housing need plus net unmet need across all of the component local authorities is used.

33. In all test years the local housing need figure for joint plan authorities plus net unmet need is used.

34. For each individual year that the joint annual housing requirement is greater than the joint local housing need plus unmet need, the lower figure is used.

35. The final number of homes required sums each year’s lower figure to calculate the 3-year total number of homes required.

In addition to steps 1 to 5, for authorities that have recently reorganised to form new unitary or single-tier authorities, the steps below were taken:

36. Local authorities who formed new unitary authorities can now choose to have their Housing Delivery Test results published using their former authority boundaries or their new unitary boundaries for the purpose of the measurement until the fifth anniversary of the new authority’s existence.^{[footnote 9]} Local authorities have the option to choose either approach over this period. For the 2023 Housing Delivery Test, the new unitary authority is Dorset.

37. To calculate the ‘homes required’ for these areas, steps 1 to 5 (and as appropriate steps 6 to 34) were carried out based on the predecessor authority boundaries. The homes required for the predecessor areas was then added together to produce a ‘homes required’ for the whole of the reorganised authority. Following reorganisation, national statistics are published at the new authority level. However, affordability ratios at predecessor authority levels^{[footnote 10]} were published by the ONS; these were used to calculate Local Housing Need for the test year 2020/21 (as of 1 April 2020), test year 2021/22 (as of 1 April 2021) and test year 2022/23 (as of 1 April 2022).

38. In previous years, we have been unable to calculate a joint score for the unitary authorities of Dorset, and Bournemouth, Christchurch and Poole as the predecessor authorities of East Dorset and Christchurch have a joint plan with joint plan housing requirement (adopted in April 2014), which cannot be disaggregated. However, for the purposes of the 2023 Housing Delivery Test this plan is now out of date for all measurement years, which means requirements can now be attributed to each authority separately.

The housing requirement for travellers:

In addition to steps 1 to 5 and the relevant process depending on local plan status, where applicable the requirement for traveller accommodation^{[footnote 11]} is added to the housing requirement.

This addition takes place prior to the application of the “lower of” policy which compares the housing requirement (containing the travellers housing requirement) and the local housing need plus net unmet need, choosing the lower for each year as the number of homes required for that test year.

The traveller’s accommodation requirement is calculated through the steps below:

39. The traveller accommodation requirement is based on the traveller’s annual average from the most recent plan for each year. If the local plan contains no traveller’s requirement, then no adjustment is made.

40. Where there is a traveller’s requirement, and the plan becomes no longer ‘up to date’, then from this point onwards the traveller’s adjustment is no longer made.

41. If the plan is no longer ‘up to date’ midway through a year, then for as many days that the plan was ‘up to date’ within a test year, the travellers annual average is used (apportioned based on how many days this was ‘up to date’). For the remainder of the year, no traveller’s housing requirement is added.

42. If the local plan includes a stepped requirement for the traveller’s requirement, then the annual average from the requirement corresponding to the relevant period is used, and the steps above are applied in the same way.

Reducing the requirement for test year 2020/21

43. Over the course of the 2020/21 measurement year, there were considerable variations in levels of housing delivery as local authorities and construction industry continued to face disruption on a national, regional, and local level due to the pandemic. As a result, the government took the decision to apply a 4-month adjustment to the housing requirement figures for 2020/21 in order to account for these fluctuations.

44. For the purposes of the calculation, the ‘homes required’ for the months of April to July 2020 will be deducted from every result. This equates to a deduction of 122 days from the homes required figure for the 2020/21 test year.

45. Housing requirements that utilise local housing need plus unmet need have been weighted to account for 8 months of 2020/21 (243 days).

46. Where the requirement for the test year 2020/21 is a combination of any number of local plans, borough plans, previous plan and local housing need plus unmet need, the appropriate weighting is applied as per the time of the test year each requirement represents.

47. No additional adjustments were applied to the 2021/22 or 2022/23 measurement period, but the 2023 HDT measurement will continue to include the adjustment for the 2020/21 year.

Using data from local plans adopted since the data collection

48. Through spring 2023, data was collected by MHCLG to carry out the 2023 Housing Delivery Test. Since that time, some local planning authorities may have adopted new housing requirements in local plans that can be used for the 2023 measurement.

49. Paragraphs 16 to 18 of the Housing Delivery Test rule book provide local planning authorities an opportunity to collaborate with MHCLG to have previous Housing Delivery Test results recalculated.

Calculating the homes delivered

To calculate the total net homes delivered over the 3-year monitoring period the calculations draw on:

• Net additional dwellings^{[footnote 12]} by local authority district, England 2001-02 to 2022/23.^{[footnote 13]}
• Housing supply: communal accommodation, component flows by local authority district, England 2020/21,2021/22 and 2022/23 (published as part of the Housing supply; net additional dwellings, England release^{[footnote 14]}).
• Number of students in student only households by the number of bedrooms where all students are aged 18 and over: Office for National Statistics based on 2021 census.^{[footnote 15]}
• Age of Household Reference Person by number of adults in household where all household reference persons are aged 16 and over: Office for National Statistics based on 2021 census.^{[footnote 16]}
• Data supplied to the department by local planning authorities and National Parks about the number of homes within a local planning authority boundary that were delivered in a National Park, 2020/21, 2021/22 and 2022/23; and
• Data supplied to the department by the Greater London Authority about housing completions in the London Legacy Development Corporation that was within different local authority boundaries, Residential Completions between 1 April 2020 and 31 March 2023 by planning authority from London Development Database.

To calculate the homes delivered, the steps taken were:

1. For each local planning authority, net additional dwellings for the test years are used as the starting point. These are then adjusted in several ways.

2. For each authority, estimate the number of net dwellings that would be freed up from the net additional student and other communal accommodation built over the 3-year period. This is calculated by dividing each authority’s student bedrooms annual net change by the national ratio (2.4) and each authority’s other communal bedrooms annual net change by the national ratio (1.9).

3. Adjust the net additional dwellings for each authority by the annual estimate of the number of dwellings which would be required in the absence of the net communal accommodation bedrooms change.

4. For the local planning authorities whose local authority boundaries overlap with a National Park^{[footnote 17]}, either:

a. Remove the net additional homes delivered in the National Park^{[footnote 18]} each year from the net additional dwellings statistics, where the local plan contains a district-specific housing requirement which excludes the National Park area; or

b. If tested against local housing need (when the plan is ‘out of date’ or by virtue of the ‘lower of’ policy), or their local plan has a joint housing requirement with the National Park, do not apply any adjustment to the net additional dwellings statistic for the local authority.

5. For those authorities who have a joint plan with a joint requirement and have chosen to have their Housing Delivery Test calculated jointly, in addition to Steps 1 to 4 above, the ‘homes delivered’ (for the individual local authorities) was summed to provide a delivery total for the whole joint plan area.

6. For those authorities who reorganised and are being scored together, steps 1 to 3 (and step 4 if appropriate) were followed:

• in years where the net additional dwellings statistics were published at the predecessor authority boundaries, these were summed to give delivery for the newly formed authority; and
• in years where the net additional dwellings statistics for the new unitary or single-tier authority was published at the new authority level this was used.

7. For Dorset and Bournemouth, Christchurch and Poole, a separate data collection was provided by the local authorities to MHCLG. This disaggregated the net additional dwellings statistic (published at the unitary boundaries). For any joint plans with joint housing requirements at the predecessor authority levels Step 5 was followed (i.e., the delivery from the individual predecessor authorities was summed for those joint plan areas).

8. For the local planning authorities whose boundaries overlap with a development corporation, for the periods that the local planning authority’s delivery is based on the London Plan or the Current Borough Plan, the net homes delivered in the development corporation are removed from the net additional dwellings statistics based on the data provided to the department by the Greater London Authority.

9. The London Plan gives separate plan numbers for the London Legacy Development Corporation and the Old Oak and Park Royal Development Corporation. This means, where the borough’s requirement is based on the London Plan, this will not include the homes to be delivered in the development corporation. Similarly, if the borough has its own plan adopted after the 2021 London Plan, its housing requirement will not include homes to be delivered in the development corporation.

10. However, Local Housing Need cannot be calculated for a development corporation. As such, a borough’s Local Housing Need will include these homes. Consequently, the adjustment to net additional dwellings, removing those homes delivered in the development corporation, would not apply only for the period where the requirement is based on LHN. For the periods where housing requirement is based on the 2021 London Plan or a more recent borough plan, neither the housing requirement nor the net additional dwellings include the homes in the development corporation.

11. If the borough’s requirement is based on different sources within a test year (for example, LHN and then the borough average from the London Plan) then the removal of net additional dwellings each year is scaled to the proportion of the year that the London Plan is relied upon for the housing requirement.

12. The final measure of the homes delivered is the sum of the annual net additional dwellings adjusted for National Park and Development Corporation delivery and the estimated net change in the dwelling stock due to the change in communal accommodation bedrooms.

Calculating the results

The result for each authority is based on their number of homes required over the 3-year period and the adjusted net additional homes delivered over the same period.

In all cases, the requirement for the number of homes is based on the ‘lower of’ their annual housing requirement (based on the local plan status and characteristics) the local housing need adjusted for net unmet need. The lower figures in all years are summed to calculate the number of homes required over the total 3-year period for the purpose of the Housing Delivery Test.

The annual net additional dwellings statistic adjusted for National Park and Development Corporation delivery, and the change in communal accommodation bedrooms are summed to calculate the total number of homes delivered over the 3 years for the purpose of the Housing Delivery Test.

Comparing these two totals gives the individual Housing Delivery test for a given authority, joint plan, merged authority or development corporation:

Housing Delivery Test (%) =

Total net homes delivered over 3 year period

divided by

Total number of homes required over 2 year 8 month period

In cases where the total number of homes required is zero (or less), the Housing Delivery Test result is undefined, and no consequences apply.

1. The department collected local plan information from authorities using DELTA webform. In some instances, the information as submitted was adapted for the 2023 Housing Delivery Test measurement and decisions about what information to use were decided on a case-by-case basis. ↩

2. To note, local plan information will be used across all test years, where applicable. For example, local plan information that informs the 2020/21 year may not be applicable for the 2021/22 year if the relevant plan is no longer up to date but may still inform the calculation for the 2020/21 year. ↩

3. See Policy H1, pages 157-165 of the 2021 London Plan. ↩

4. Regulation 10A of The Town and Country Planning (Local Planning) (England) Regulations 2012 (as amended) requires local planning authorities to assess whether their local plan remains up to date at least every 5 years from adoption. ↩

5. Please note: any conclusion reached on a plan review relates solely to whether a review has been carried out, so that MHCLG can calculate the Housing Delivery Test (as set out in paragraph 12 and footnote 8 of the Housing Delivery Test Rule Book). Any such conclusion does not indicate that the Secretary of State for Housing, Communities & Local Government endorses or makes any other judgement on status of a particular plan, or review for decision or plan making purposes. ↩

6. The amount of unmet need being taken and given must balance out between respective local authorities. Unmet need should be planned for in an adopted plan. Identified need in an emerging plan or its supporting evidence base such as a Statement of Common Ground or Memorandum of Understanding will not usually be accepted. ↩

7. An ‘up to date plan’ for the purposes of the Housing Delivery Test is a plan with an adopted housing requirement which is less than 5 years old or is older than 5 years old and has been reviewed and found not to require updating.‘Out of date’ for the purpose of the Housing Delivery Test, is a plan with an adopted housing requirement which is 5 years old or older and: has not been reviewed or a review has been carried out after the 5-year deadline or a plan review has found that the strategic housing policies require updating. ↩

8. The London Plan figure remains valid for 5 years from the date of adoption, even where the plan is undergoing a revision. ↩

9. See Written Ministerial Statement by the Housing Minister on 6 September 2021. ↩

10. House price to workplace-based earnings ratio for former local authorities and House price to workplace-based earnings ratio for former local authorities 2019 to 2020 and House price to workplace-based earnings ratio for former local authorities. ↩

11. Meeting the definition in Planning Policy for Traveller Sites (December 2023). ↩

12. As defined in the Housing Flow Reconciliation guidance. Net additions measure the absolute increase in stock between one year and the next, including other losses and gains (such as conversions, changes of use and demolitions). ↩

13. Net Additional dwellings Live Table 122. ↩

14. Housing Supply: net additional dwellings: Communal Accommodation (Bedspaces) 2020-21, 21-22, 22-23 Table 124. ↩

15. Used to calculate the national average number of adult students living in a student only household where all students are aged 18 and over (2.4). This table  specifically commissioned for this purpose, is published by the ONS: CT21_0306_Census 2021. ↩

16. Used to calculate the national average number of adults living in a household where all Household Reference Persons are aged 16 and over (1.9). This table, specifically commissioned for this purpose, is published by the ONS: CT21_0307_Census 2021. ↩

17. Household growth and local housing need are set at local authority level, containing the district local planning authority and part of National Park planning authority. ↩

18. As provided to the department by local planning authorities and National Parks. ↩