Housing minister to shake up rules on house building.
Today, Sajid Javid will deliver a speech on changes to planning rules that aims to tackle the UK housing crisis.
This comes as research by Shelter and The Campaign to Protect Rural England suggests residential developers are using a legal loophole to avoid building substantial numbers of affordable houses in rural areas. Rural areas have a desperate need for more homes.
Developers are required by local planning authorities to provide a proportion of affordable homes – typically 30% in any new development. But many use ‘Viability Assessments’ to negotiate down this number. They argue that such a requirement would adversely affect their profit margins.
Developers were using Viability Assessment to argue that meeting set ratios of affordable homes could cut their profits to below 20%. At this point they have the legal liability under current law to negotiate to reduce how many they are required to build.
Shelter and CPRE say that developers often deliberate over paying for building land as a matter of practice. They claim that developers are using the system to at least recoup the extra cost by driving down the amount of affordable homes they are required to build
This “loophole” may well be an item which the Government addresses in today’s speech.