Planning Reform and Housing Viability

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1 Planning Reform and Housing Viability Colin Wiles

2 National Planning Policy Framework 1,000 pages reduced to 52 Framework for all future development Plan-led Golden thread of sustainable development

3 NPPF Presumption in favour of sustainable development where local plans are absent or silent Sustainable development has economic, social and environmental dimensions End of national Brownfield-First policy National infrastructure projects not included

4 NPPF on housing Provide for the full, objectively assessed needs for market and affordable housing in the housing market area and identify key sites which are critical to the delivery of the housing strategy over the plan period. Provide a supply of deliverable sites for five years supply plus a 5 percent buffer (20 percent for poor performers). Identify a supply of specific, developable sites or broad locations for growth, for years 6-10 and, where possible, for years

5 NPPF on housing (2) Widen opportunities for home ownership and create sustainable, inclusive and mixed communities Plan for a mix of housing based on current and future demographic trends, market trends and the needs of different groups in the community Identify the size, type, tenure and range of housing that is required in particular locations, reflecting local demand Meet needs on site, unless off-site provision or a financial contribution of broadly equivalent value can be robustly justified Policies should be sufficiently flexible to take account of changing market conditions over time.

6 Local Plans Based on objectively assessed needs of the area Set out opportunities for development Plan positively for growth and infrastructure 15 year timescale Duty to co-operate with adjacent authorities Strategy to enhance the natural and built environment

7 Local Plan progress 76% of LAs have a published draft plan 51% have an adopted plan 500 communities have a designated neighbourhood plan 750 communities have been designated/expressed interested in having a neighbourhood plan

8 Market signals Plans should take account of market signals, such as land prices and housing affordability, and set out a clear strategy for allocating sufficient land which is suitable for development in their area

9 Market signals - guidance Prices or rents rising faster than the national/local average may well indicate particular market undersupply relative to demand. Land Prices Rents House Prices Affordability ratios CLG On-line Planning guidance

10 Affordability ratios - Eastern Hertsmere 14.9 Three Rivers 14.7 Uttlesford 13.7 St Albans 13.7 Fenland 7.5 Duty to cooperate in NPPF NHF Home Truths 2012

11 What do we need to build in England? Household growth of 230,000 per annum to 2033 (CLG) Need for 5 million new homes by 2033 Only <1.5 million can be built on brownfield Therefore: 3.5 million required on urban extensions and new settlements

12

13

14 Public attitudes to house building 36% agree there is enough affordable housing in their local area (59% disagree) 77% agree that is harder to buy or rent than it was for their parents 90% agree that it will be harder for today s children to buy or rent than it is for them IPSOS MORI Feb 2013

15 There may be a housing crisis but it s not around here 80% agree there is a housing crisis in Britain (18% disagree) 44% agree there is a housing crisis in their local area (49% disagree) IPSOS MORI Feb 2013

16 If England was a football pitch

17 Protected England TOTAL million hectares 100% Built upon 1.30 million ha 10% Green belt 1.69 million ha 13% National Park 1.17 million ha 9% AONB 1.96 million ha 15% SSSI.91 million ha 7% Other countryside 6 million ha 46%

18 Cambridge Green Belt

19 Cambridge Green Belt Built up Cambridge 4,070 ha Green Belt = 26,340 ha (Green Belt within City boundary = 995 hectares) Cambridge Green Belt is 6.5 x larger than the built up area of Cambridge

20 Horses and houses Up to 1 million horses in England <1 hectare each =600,000 hectares for horses 1.3 million hectares for people 100,000 hectares could provide 3 million homes

21 Community Infrastructure Levy & New Homes Bonus New Homes Bonus - the Government matches the council tax raised from new homes for the first six years. To encourage growth, but it is not ring fenced. Community Infrastructure Levy for infrastructure, community development, open spaces etc Set at x per sq metre

22 CIL front runners Core strategy in place Clear understanding of infrastructure gap Clear evidence and understanding of future development A clear story about growth in the area

23 CIL Progress - Eastern region Approved Hunts East Cambridgeshire Greater Norwich (Broadland, Norwich and South Norfolk) Submitted Chelmsford Bedford Hertsmere

24 CIL examples Hunts 85 per sq metre of new floorspace Norwich Residential (not affordable) storey flats 65 Large stores of 2000 sq m plus 135 Other retail 25 Fire stations etc 0 Other 5

25 East Cambridgeshire Residential Zone A Littleport and Soham 40 Residential Zone B Ely 70 Residential Zone C - Rest of the district 90 Retail development1 120 All other uses 0

26 CIL Localism Charging authorities must allocate a meaningful proportion (15%) of levy revenues raised in each neighbourhood back to that neighbourhood. This will ensure that where a neighbourhood experiences a new development, it receives sufficient money to help it manage the resulting impacts on the locality. 25% if a neighbourhood plan is in place

27 Reviewing stalled section 106 sites 1,411 housing schemes of over 10 units (totalling 75,534 units) with planning consent are on hold Some section 106 agreements negotiated in more buoyant times will no longer be viable Obligations should only be sought where they are necessary to make the development acceptable in planning terms CLG guidance April 2013

28 Revised section 106 viability Developer applies to LA for revised affordable housing obligation Should be supported by viability evidence Can appeal to Secretary of State if successful the scheme must be completed within 3 years CLG guidance April 2013

29 Viability formula The current cost of building out the entire site (at today s prices) is at a level that would enable the developer to sell all the market units on the site (in today s market) at a rate of build out evidenced by the developer, and make a competitive return to a willing developer and a willing landowner. The developer will need to demonstrate to the planning authority, and to the Planning Inspectorate on appeal, that the affordable housing obligation as currently agreed makes the scheme unviable in current market conditions. CLG guidance April 2013

30 Viability continued In those cases where an original viability appraisal was not prepared prior to planning permission being granted, the developer must clearly demonstrate through evidence why the existing scheme is not viable. A proposal to bring the scheme into viability should be submitted. At appeal, if the developer is unwilling to proceed on an open book basis, general evidence of changes in costs and values since permission was granted can be submitted; however developers must consider whether this approach will provide sufficient evidence for the Planning Inspectorate to make a robust, impartial decision on viability.

31 Housing viability HCA website Area Wide Viability Model Tests viability of strategic issues can help to establish policy on affordable housing, CIL, section 106 CIL viability Uses a range of residential permutations and tests deliverability - draws on SHLAA data Both for nil grant and added value from public investment Development Appraisal Toolkit for individual sites Local assumptions on costs and value Identifies residual land values with a range of permutations. Can assist LA planners to negotiate

32 Thanks for listening and taking part

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