In August 2024, the UK government released a draft revision to the National Planning Policy Framework (NPPF), sparking widespread debate about the future of real estate, housing supply, and development across the country.
The proposed changes, which are out for consultation until September 24th, aim to address longstanding challenges in housing and commercial development while balancing the pressures of sustainability, affordability, and regional disparities.
The revisions to the NPPF have the potential to significantly reshape the real estate landscape, but as with any sweeping policy reform, there are both opportunities and challenges.
Presumption in Favour of Sustainable Development
At the heart of the NPPF’s revisions is the continued presumption in favour of sustainable development. This concept remains, but the government has broadened the circumstances under which it applies. This change is designed to clarify when the so-called "tilted balance" should be engaged, particularly when policies for land supply are deemed out-of-date. This clarification is especially welcomed.
Broadening the applicability of this presumption because of other proposed changes, such as those on Green Belt and the new approach to the Standard Method, the government is signalling its intent to accelerate the approval of housing applications in the future. This is a useful step in addressing the ongoing housing crisis, but it also raises questions about whether the changes will address the longer held perception that the presumption has been weakened over time.
Housing Land Supply and the Standard Methodology
One of the most significant changes in the draft NPPF24 is the restoration of the requirement for all local planning authorities (LPAs) to demonstrate a five-year housing land supply (5YHLS), even when a Local Plan is less than 5 years old. This marks a reversal from the softened housing land supply requirements introduced in December 2023, which allowed LPAs with recently adopted plans to demonstrate only a four-year supply. The reinstatement of the five-year requirement, along with the removal of the ability to count previous over-supply against future need, underscores the government’s determination to ensure a steady pipeline of housing.
This change is likely to increase pressure on LPAs to approve more housing development, particularly in areas where housing delivery has fallen short in recent years. Together with the reintroduction of the 5% and 20% buffers in the 5YHLS calculations, this is a consistent powerful message that supply is king. The revised standard methodology for assessing housing need is another key element of the draft NPPF24.
The government has made it clear that this methodology is no longer merely an advisory starting point, but effectively mandatory, with fewer opportunities for LPAs to deviate from the prescribed figures. This will likely result in an overall increase in housing targets as the government pushes toward its goal of delivering 1.5 million homes over the next five years. Regional variations will also come into play, with some areas facing very steep increases in housing requirements, while London’s target may be revised downward.
While the government’s focus on boosting housing supply is commendable, there are concerns about the impact of these changes on local communities and the environment where there are significant uplifts. The increased housing targets could lead to more pressure on green spaces, infrastructure, and local services, particularly in areas that are already struggling to accommodate new development. Striking the right balance between housing delivery, providing infrastructure and maintaining people’s quality of life will be a key challenge for policymakers if these changes are adopted.
Design Code and Local Character
The NPPF revisions also address the contentious issue of design and local character in new developments. In response to criticism that the previous emphasis on "beauty" and "beautiful" development was too subjective, the draft NPPF24 proposes a return to more objective standards, drawing on the National Design Guide and National Model Design Code as the primary references for local design codes. This shift away from subjective notions of beauty is a welcome development, as it provides clearer guidance for developers and local authorities alike.
However, the proposed removal of recent provisions that allowed local character considerations to limit significant density increases has to be balanced with addressing the housing shortage. NPPF24 introduces an acceptance in principle for brownfield developments at para 122 (c), building on the existing requirement to give such developments substantial weight (which is maintained) and further strengthening policy support for housing development on brownfield land.
Encouraging greater density, particularly in well-served areas, is a sensible approach to addressing the housing shortage. It is possible to achieve higher densities in a way that is sensitive to the local context.
Affordable Housing and Green Belt
Affordable housing remains a key priority in the draft NPPF24, with the government proposing new policies to ensure that the mix of affordable housing meets local needs. Notably, the existing requirement for 10% of homes to be provided for affordable home ownership has been removed, instead the government proposes bringing First Homes into guidance following the Ministerial Statement on the subject in 2021 and an emphasis on meeting local needs across social and intermediate tenures. A 50% affordable housing target (subject to viability) has been introduced for residential developments on Green Belt land.
The detail is explained in Annex 4 but it raises the potential for most Green Belt sites to be subject to the viability test. Further, the scenarios set out in the questions accompanying the consultation, include the prospect of setting benchmark land values for Green Belt below that of other land, and then using LPAs and Homes England’s CPO powers to ensure policy-compliant schemes come forward. Setting Green Belt land apart via a benchmark land value with more restrictive policy requirements risks disincentivising landowners to sell land and reducing the scope for viable development.
Still under the Green Belt theme, the new reference to Grey Belt and watering down of existing guidance is the greatest proposed reform in terms of the NPPF24. The guidance refers to Grey Belt as covering areas of Previously Developed Land (PDL) and/or land that make a “limited contribution” to the Green Belt purposes. The definition of what constitutes PDL and Grey Belt is being consulted on. In terms of Local Plans, the NPPF24 proposes that housing needs can expressly justify exceptional circumstances for Green Belt release, instead of implied recognition previously referred to, going on to mandate that LPAs review and, if necessary, alter Green Belt boundaries when they cannot meet housing or commercial requirements in full.
From a development management perspective, the introduction of the Grey Belt review creates essentially a sequential approach to the release of land i.e., in short, brownfield, Grey Belt, Green Belt. Furthermore, expanding the definition of what is not inappropriate development in the Green Belt to include (i) Grey Belt land in sustainable locations; (ii) where LPAs cannot meet the 5YHLS, or, (iii) can demonstrate that development is of local, regional or national importance which justifies the need for land to be released, has the potential to be a ‘game changer’ for releasing housing land.
Whilst this may look positive, there are further requirements placed on land released from the Green Belt through planning applications. This is referred to as the ‘Golden Rules’ and housing schemes are subject to the provision of at least 50% affordable housing referred to above, securing relevant infrastructure improvements and provision of local green spaces. Most schemes will expect to demonstrate the latter two criteria, it is the first which will create some challenges. These proposals outlined above suggest that the government is willing to relax some of the traditional protections on Green Belt land to meet housing demand and we are already seeing this in early appeal decisions.
Commercial Development and the Future of the Modern Economy
The draft NPPF24 also places a strong emphasis on commercial development, with a particular focus on meeting the needs of the modern economy. The government has highlighted the importance of identifying suitable sites for new commercial facilities, such as laboratories, gigafactories, data centres, and digital infrastructure. This reflects the growing recognition that the future of the UK economy will depend on its ability to attract and support cutting-edge industries.
By prioritising commercial development that aligns with the needs of the modern economy, the government is signalling its commitment to fostering innovation and ensuring that the UK remains competitive on the global stage. However, the success of this strategy will depend on the ability of LPAs to identify and deliver suitable sites for these facilities, as well as the willingness of developers to invest in these emerging sectors.
Conclusion
The draft revisions to the National Planning Policy Framework represent a bold attempt to address the UK’s housing challenges in particular. By clarifying the presumption in favour of sustainable development, reinstating the five-year housing land supply requirement, and prioritising affordable housing and commercial development, the government is seeking to reassert the role of planning in supporting economic growth. However, the success of these reforms will depend on their implementation. The government will need to stick to the majority of the proposed changes and be willing to do battle with those who challenge them with little merit. At the moment, without further financial assistance and resourcing of planning departments however, the reforms will take longer to implement than should be the case.
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