The big developers have 'land banks' capable of accommodating about half a million homes, but they prefer to drip-feed developments into the market over time to limit supply and keep prices at a premium. It's in their interest to build homes but definitely not in their interest to create a glut.
The entire start to finish planning process takes an average of 7 years. The large developers don't sit on cash mountains (I'd had a nose at their accounts last year) to be able to fund the working capital to develop more and they need to ride out very long lulls in the market such as the last two or three years ... very few buyers.