Why Last Week's Planning Reforms Could Boost Housing Supply

Why Last Week's Planning Reforms Could Boost Housing Supply

As part of last week's Budget, the Chancellor George Osborne and business secretary, Sajid Javid, set out a new policy document promising to shake-up the country's planning laws. The 90 page plan, titled Fixing the Foundations: Creating a More Prosperous Nation, also covered topics like trade, transport, tax, higher education, devolution and long-term investment.

But it was the proposed planning reforms that most caught the eye. The new proposals – which still need to be ratified by MPs – would mean, amongst other things, automatic planning permission being granted on all brownfield sites under a new zonal system, something that is already in place in many other countries. It is hoped this would remove unnecessary delays to redevelopment.

In the capital, meanwhile, ministers would look to relax the rules on extensions, allowing developers/individuals to extend properties to the height of neighbouring buildings. In other words, making it easier for buildings to go upwards rather than outwards to help ease overcrowding and make house building in London more dynamic.

Another measure would involve the devolution of planning powers to mayors in London and Manchester, while compulsory purchase powers will be strengthened to allow more brownfield land to be made available for development.

Sanctions for local authorities who don't process planning applications quickly enough would also be introduced, alongside extra powers for the government to intervene in councils' local development plans.

Under the new plans, major projects could be fast-tracked through the Nationally Significant Infrastructure regime and ministers would have the right to seize disused land for housing purposes.

All this comes at a time when housebuilding is on the agenda more than ever. Recently released official figures showed that new house building dropped by 5.8% in May, the sharpest fall in almost four years. Equally, the 140,000 new homes built last year were nowhere close to meeting demand.

The lack of supply in the housing market has been a major issue for a number of years now, with successive governments failing to act upon their promises when it comes to housebuilding. One of David Cameron's main election pledges was a promise to make 200,000 starter homes available to first-time buyers in England by 2020, not long after the coalition government had announced plans for 100,000 affordable homes for those under the age of 40.

Britain has suffered from a worrying lack of housebuilding for decades; that isn't going to change overnight. As the population grows year by year and high house prices force more and more people into the Private Rented Sector (PRS), the need for fresh supply is greater than ever.

Bringing brownfield sites back into use is a pragmatic and sensible measure, but it doesn't come without its own issues and complications. Making these sites safe doesn't come cheap and some of them wouldn't necessarily be put to best use for residential purposes. Another issue is volume, some experts have suggested that there may not be enough brownfield sites – urban land, once used for industrial or commercial purposes, that has now been left vacant or decrepit – to meet the UK's housing needs over the next few decades.

Regenerating brownfield sites and bringing empty homes back into use are two ways of increasing supply, but they will not solve the housing shortage on their own. A concerted housebuilding effort – fully backed by the government, developers and local authorities – needs to be put in place to narrow the gaping supply/demand imbalance. There are, of course, limits to building on the Green Belt, but by all accounts there is land available for housing. Nonetheless, for one reason or another, it is not being built on.

While we are still concerned about housebuilding levels, we are much more positive about the other planning reforms. Fast-tracking major projects, devolving more power to local bodies, and giving incentives to councils to push through planning applications much quicker are all welcome developments. For too long in this country, the planning process has been disrupted by delays, bureaucracy, appeals and complacency, so hopefully these new measures will make things smoother, quicker and less frustrating for all concerned.

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