NFB: Want more affordable homes? Reform the planning system!

Posted On: 
27th February 2019

Helen Hayes MP will introduce the Planning (Affordable Housing and Land Compensation) Bill, which seeks to ensure that our planning system can deliver what local communities urgently need, including affordable social housing.

As well as strengthening the compulsory purchase process, the bill would replace the current definition of ‘80% of market price’ with a definition of “no more than 35% of net household income for lowest quartile income groups in each local authority area”.

Hayes said: “It is vital that our planning system provides certainty and transparency and puts an end to speculation on land values which prevents land from being used to deliver new homes.”

Helen Hayes MP: Our planning system must deliver the genuinely affordable homes communities need

The National Federation of Builders (NFB) welcomes efforts to reduce inflated land prices but is concerned that Ms Hayes sees land value uncertainty as primarily in the developer’s and landowner’s gift and not within the planning process itself.

For smaller developers, including housing associations, community housing groups and self-builders, the uncertainty in the planning system often makes developments unviable.

Viability assessments often use out of date construction rates and do not factor in planning delays such as extension of time requests or time taken to clear pre-commencement conditions. Put more bluntly, they ignore the extra costs such as council tax being charged on unfinished units and do not understand that each day developers wait for permission, they are paying staff that are not working.

Richard Beresford, chief executive of the NFB, said: “While the definition of affordable housing needs to be changed and councils need more compulsory purchasing power, if the planning process gets more expensive, fewer affordable homes will get built.”

Rico Wojtulewicz, head of housing and planning policy at the House Builders Association (HBA), said: “Undeliverable local plans, chargeable pre-commencement conditions, decision delays and uninformed viability assessments are just some of the barriers developers face when evaluating the cost of land. If you want more affordable housing, reform planning.”