How planning changes are impacting housebuilding and UK housing

Since last summer, there have been some major reforms to the planning system. Are these changes leading to more roof developments and additional UK housing?

In the past year, there have been a number of reforms to the planning system. In particular, there have been some major changes to permitted development rights. Some of these reforms could boost the housebuilding sector and bring forward more UK housing in the years to come. However, there are some worries about recent changes.

Permitted development rights

In the past few years, there have been quite a few changes to permitted development rights. Back in 2013, the government brought in permitted development rights where developers could turn office buildings into housing without formal planning permission. They instead need to contact the local authority of its plans and gain prior approval.

Now, the government has announced new planning rules for town centres. From 1st August 2021, a new permitted development right will come into effect for buildings in town centres. This will allow a change of use from the class E use for commercial, business and service buildings to housing.

Communities Secretary Robert Jenrick says: “We are creating the most small business friendly planning system in the world to provide the flexibility needed for high streets to bounce back from the pandemic.

“By diversifying our town and city centres and encouraging the conversion of unused shops into cafes, restaurants or even new homes, we can help the high street to adapt and thrive for the future.”

The government says this could attract more footfall to town centres. However, some people worry this will lead to low-quality housing and could post a threat to the high street.

Building upwards

Last year, the government made it easier for developers and individuals to build upwards. This allowed “in principle” agreements for upwards extensions for two additional storeys on detached flat blocks.

Some in the property industry feel building upwards on existing buildings can help bring forward more UK housing. Interest and demand in building upwards has seen an increase. However, according to rooftop accommodation specialists BRAC Developments, there hasn’t been a strong rise in these kinds of development being brought to fruition.

Adam Clark, managing director of BRAC Developments, says: “Last summer’s PDR changes were a welcome step forward in enabling more airspace projects and interest in developing on rooftops has certainly grown ever since.

“However, with any freeholder able to apply for and often secure planning permission for a relatively small sum of money, we’re now seeing that rooftops are being marketed for greatly inflated sums making acquisition and development financially unviable.”

Redeveloping roof space

Asking prices for roof areas have inflated to such high levels that they are not financially viable for many investors and developers. This appears to be damaging progress in the sector.

“Of course, any plot – rooftop or otherwise – with planning permission already in place commands a higher value than that which does not, but the impact that the opening up of airspace’s potential has had on perceived values is mind-boggling,” Adam Clark comments. “Not only that, but it’s actually having a detrimental effect on progress in the sector.”

Many in the industry would like to see more progress made with redeveloping roof space of residential and commercial buildings to provide much-needed housing.

Building more homes

Additional planning reforms were recently announced in the recent Queen’s Speech. The long-awaited Planning Bill includes the cutting of red tape to substantially reduce the amount of time it takes for a standard housing development to go through the entire planning process.

Land designated for new homes, hospitals and schools also will receive automatic permission. These developments will fall under the “for growth” category.

These new planning reforms will likely lead to higher housebuilding outputs. Additionally, these changes could help the government reach its target of building 300,000 new homes a year by the mid-2020s.

Higher green standards, which is an increasingly important issue, are also being introduced for new-builds. This will hopefully bring forward more energy efficient properties to improve the quality of UK housing.

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