Wholesale changes to the planning environment may soon be on their way, with the aim of speeding up the planning process so more homes are built sooner. While time will tell if what is introduced works, there are some significant changes on the horizon which should be considered in business planning now. David Armstrong, Chief Financial Officer at Flagship Group and Steven Brook, Chief Executive at Harrogate Housing Association, assess the detail.
A summary of the main proposals:
Putting aside the elephant in the room that it might be abolished in a couple of years, if you currently rely on Section 106 for growth then you need to be prepared for:
In summary, fewer affordable homes would be available to meet your development commitments. There is the knock-on risk that this drives up prices as we compete for a smaller pool of available homes.
We may be looking at a bigger market exposure on our own sites – and therefore increased risk. Depending on how First Homes policy is applied, and how shared ownership is affected, we could see almost all the homes on some of our sites being market facing. This could lead to:
When combined with the proposed changes to shared ownership and the new Affordable Homes Programme, financial planning and development just got a whole lot trickier…
For more on the details and potential impact of recent planning reform proposals, the NHF has published its response to both the consultation on changes to the current planning system, and the white paper, Planning for the Future.