Director at BH Planning and Design, Mark Ketley, explores the current planning industry and how it is affected by the government's new housing policy.
The role which the planning profession has in helping to deliver housing growth has never been greater. The past year has seen a plethora of new policy initiatives and consultation proposals in reaction to the Government’s policy agenda which is heavily focussed on planning reform and ensuring a system is put in place capable of addressing the national housing crisis. The initiatives and proposals are aimed at fixing the broken housing market and boosting supply towards a long-term target of delivering 300,000 new homes per year.
On March 5 the consultation version of the new National Planning Policy Framework (NPPF) was published and, not surprisingly, it identifies the delivery of additional new homes as a fundamental principle and a clear priority underpinning the whole of the Government’s intended approach to planning.
The key question, and the biggest challenge facing the industry, is therefore how will a doubling of current housing supply rates be achieved whilst ensuring this is delivered in an environmentally and socially sustainable way?
Recent decades have shown that incremental developments alone will not meet the level of demand for new homes – nor will they achieve sustainable development in its truest sense. It is therefore time to start thinking outside of the box and look to support alternative forms of housing delivery on both a small and large scale.
Although the current market is providing a more attractive environment for housebuilding – with investment and improved economic conditions both contributing significantly to an increase in supply in excess of 50% nationally in the last three years – there remains a need for long term planning to ensure delivery of housing on an even larger scale.
The difficulty that the Government has is that the main volume housebuilders, responsible for around 90% of housing growth since the recession, cannot continue to expand indefinitely and therefore alternative delivery mechanisms need to be found.
Large scale garden towns and villages have been touted as the solution for accelerating supply rates, and they will inevitably make a meaningful contribution following the Government’s promotion of its garden settlements initiative. However, whilst the new NPPF acknowledges that the supply of large numbers of new homes can often be best achieved through planning for larger scale development, this is often only the case in strong market areas. Small sites on the other hand are consistently efficient across all areas and have quick build-out rates.
The draft new NPPF proposes to place a requirement on all Local Planning Authorities for at least 20% of sites identified for housing in their development plans to be half a hectare or less in size – a measure aimed very clearly at stimulating others to supplement the major residential development companies. Whilst affordable housing providers and public-sector organisations, including Local Authorities, will have a key role to play, a wholesale reinvigoration of the SME housebuilding sector seems essential if housing supply is to be propelled towards the ambitious targets being set by Government.
SME businesses have unfortunately been in sustained decline for many years for a variety of reasons including ever-tougher tax and regulatory frameworks, access to land policy, and funding constraints. Therefore, according to the HBF, there are only 2,500 SME operators building homes today compared to over 12,000 at the height of the last housebuilding boom in the late 1980s.
A much greater role for SMEs is anticipated, and indeed required, in the coming years with many Local Authorities starting to realise that a greater diversity of sites will help in achieving their housing requirements more effectively. This has also clearly been recognised by the Government in their proposed revisions to the NPPF.
The availability of suitable housing sites combined with the constant struggle of securing an implementable planning consent through a planning process beset by delays and bureaucracy, inevitably creates delays and costs for SMEs that have a significant impact on their ability to establish themselves and grow. Understanding these challenges and how to address them is therefore vital for our land and development clients as we look ahead to the new NPPF world.
