‘BUILD, BUILD, BUILD’ PLANNING REFORMS TO HELP KEY WORKERS

By Owen Angel

August 2020

Managing your portfolio

In his editorial of 2nd August 2020 Tim Shipman, of The Times, comments on the government’s plan to respond to the PM’s ‘build, build, build’ promise; ‘Ministers will unveil a “blockbuster” planning revolution this week to fulfil Boris Johnson’s pledge that the government will “Build, build, build” and make it easier for key (and frontline) workers to afford a home. Robert Jenrick, the secretary of state for housing, communities and local government, will publish a policy paper on planning that will make it much more difficult for local authorities to block new development’.

Jenrick told Times Radio: “It will be much simpler and faster, and enable people to get on and build.” The paper, entitled “Planning for the Future”, will also outline plans to use money from developers to give discounts of up to one-third off the cost of a house to local people.

The move would allow councils to prioritise housing for key workers such as police, nurses and teachers.

The main change outlined in the document is a new zoning system for planning approvals, which will take individual decisions over planning permission out of the hands of town hall chiefs. Local plans will designate specific zones where new homes can be built and within them there will be a presumption that new houses get the go-ahead.

In order to placate existing local communities, Jenrick will introduce new “design standards” to ensure that properties which get the go-ahead in this way are in keeping with the style and design of existing properties. Local councils would still have a say in where the developments took place, but the new measures would prevent problems in the current system where housing is turned down by planning committees, even when it is in areas designated for development in local plans.

The policy paper, which will be published towards the end of the week, will rule out changes to allow more building on green-belt land. But it will introduce a new system of developer contributions to infrastructure, taking money from those who make huge profits by sitting on undeveloped land.’

In what may possibly seen as a partial rebuttal to the Government’s plans, Philip Collins of The Times argued on 6th August;

 ‘There are some valid criticisms of the plans. The abolition of what are known as Section 106 agreements may reduce the already short supply of social housing. The supply of housing is, of course, one reason that house prices and incomes do not match but it is not the only one. It is unlikely, even under this more relaxed planning regime, that Mr Johnson’s government will be able to hit its target of building 300,000 houses a year.’

Over the last week there have been a plethora of articles about the Government’s ‘build, build, build’ planning reforms. Our perspective at Crowdify, see Section 106 replaced by a fixed levy on development to fund infrastructure, which could potentially put affordable housing development at risk. However, there appears to be a whole tranche of people who probably would be better off in rented accommodation, because owning a house comes with risks that they may not be able to afford. Home ownership in the UK has never covered more than about two-thirds of the population, while in other countries the figure is usually less.

Consequently, there will always be a need for cheap (and stable) rented accommodation.  However, this doesn’t absolve the Government from the need to build more. Perhaps it should look to encourage social investment organisations – such as Crowdify to become more involved – who look to build properties for long-term rental, providing stable tenancies while offering steady income returns to those investors not interested in speculative building and selling.

Become Part Of Our Investor Community

In order to become a member of our investor community, you must meet current FCA guidelines by completing a sign-up and onboarding procedure. This process will identify you as a specific type of investor, providing you will full access to our social property investments listed on the platform.