Jonathan Hyldon, senior solicitor, takes a look at a recent landmark planning judgment which affects affordable housing developments.
The Government (Department for Communities) has won a legal challenge against a High Court ruling which quashed a national planning policy whose intention was to exempt small sites from affordable housing obligations.
Previously the High Court, following an application by Reading Borough Council and West Berkshire District Council, had ordered that the policy, which excluded developments of 10 homes or fewer, or 1,000 square metres or less, from the requirement to provide or contribute to affordable housing provision be removed from the Government’s National Planning Practice Guidance. In rural areas, a lower threshold of five homes would have been excluded from the requirement. This was on the basis that the policy, which was introduced in a ministerial statement in Parliament in November 2014, would reduce the amount of affordable housing across the country by 20 percent.
The latest ruling will have an immediate effect on developers’ negotiations on small scale and brownfield sites. A community charge will still be payable, however, developers will now be able to rely on those paragraphs in negotiations as to affordable housing levies and tariff based infrastructure contributions, dependent, of course, on the number of dwellings and size of the development as well as the stage in the planning process they are currently at. The paragraphs which have been reinserted in the National Planning Practice Guidance will include the following points:
Developments of 10 units or 1000 sq m or less (including annexes and extensions) will be excluded from affordable housing levies and tariff based contributions;
A lower threshold will apply in designated rural areas, National Parks and Areas of Outstanding Natural Beauty (as defined in section 157 of the Housing Act 1985), with developments of 5 units or less being excluded from affordable housing levies and tariff based contributions. Development of between 6 and 10 units will be subject to a commuted sum payable on or after completion;
Where a vacant building is brought back into use or demolished for redevelopment, local authorities will provide a ‘credit’, equivalent to the floorspace of the vacant building, to be set against affordable housing contributions.
The ruling will also have a knock-on effect on councils that are still promoting local plans that may or may not require affordable housing contributions for small projects, as well as those looking to set community infrastructure tariffs.
The ruling itself dated 11th May can be viewed in full here.
If you require specialist planning advice or would like to discuss how the ruling may impact upon you or your business in more detail please contact either myself or Dan Humphrey in our Commercial Property department.