The Government promised to introduce the Housing Bill this month. While this is awaited, more details on the government policy on housing and planning have emerged from statements at the Conservative Party Conference.
In his speech to the Conservative Party conference in Manchester, David Cameron said that a "national crusade to get homes built" is needed; "That means banks lending, government releasing land, and yes – planning being reformed,".
He promised a "dramatic shift" in planning rules to sweep away the requirement for developers to build affordable homes for rent in a bid to increase the building of homes for first-time buyers.
The Prime Minister said "those old rules which said to developers, 'You can build on this site, but only if you build affordable homes for rent', we're replacing them with new rules. You can build here, and those affordable homes can be available to buy."
The Prime Minister told the conference that, "for years, politicians have been talking about building what they call affordable homes, but in many ways the phrase was deceptive. It basically meant homes that were only available to rent. What people want are homes they can actually own".
The Government therefore intends to change the definition of affordable housing which currently excludes discounted market housing (NPPF). It does however fit with the Conservative Party’s general election manifesto which stated, "As the party of home ownership, we want to go further and faster" and pledged 200,000 starter homes, to be sold at a 20% discount below the market rate and built exclusively for first-time buyers under the age of 40. The cost would be capped at £450,000 inside London and £250,000 outside.
With a political agenda clearly driven by the Treasury which views housebuilding as contributing to the economy it was also widely reported that George Osborne used the word “Build” 25 times in his address to the Conservative Party Conference earlier this week. Earlier this year the Treasury had confirmed, in its publication 'Fixing the Foundations' that to deliver the commitment to Starter Homes it would bring forward a number of further measures.
We can therefore expect a torrent of new legislation and guidance later this year as the Government drives forward its planning reform. It should however proceed with care. The High Court quashed the Written Ministerial Guidance issued by DCLG which sought to prevent local planning authorities imposing affordable housing requirements on proposals with 10 or fewer dwellings. Whilst the Government has been given leave to appeal that decision, there have been unintended consequences in the imposition of year on year rent reductions on housing associations who currently deliver much of the affordable housing through S 106 agreements. These changes have often led to developments being delayed as the housing associations re-consider their business cases. The same may happen with these latest announcements as housing developers wait to hear about the details.
Kevin Gibbs, partner in the Planning Team commented, "Above all else the housing market needs certainty and consistency. Previous Government initiatives to change the affordable housing system have experienced difficulties. If planning reform is on the agenda, as appears to be the case, then the Government should avoid piece meal changes and should provide for a comprehensive reform package that delivers affordable housing both to those able to purchase and those in the rented sector."