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Planning reforms ‘must encourage housing developments in more affordable areas’

·4-min read

New homes, schools and hospitals should be delivered more quickly and efficiently under Government plans.

The Planning Bill is designed to create a simpler, faster and more modern planning system – to replace the current one dating back to the post-Second World War era of 1947.

But property professionals said the Bill must encourage the development of homes in more areas that are affordable for first-time buyers and people on low incomes.

Under the reforms outlined in the Queen’s Speech, homes and infrastructure such as schools and hospitals should be delivered at a faster pace across England.

The planning system will be transformed from a slow, document-based one to a more efficient digital and map-based service, the Government said.

Communities and developers, particularly smaller developers, should have a better idea about what is permitted and where under the new system.

House prices have recently hit a string of record highs, with home-buyers being encouraged by a stamp duty holiday to snap up properties.

Tom Fyans, campaigns and policy director of CPRE (the Campaign to Protect Rural England) said the Planning Bill “risks creating a free-for-all for development”.

He said: “We know from painful experience that, without the right checks and balances in the planning process, developments can lead to a huge and unnecessary loss of countryside while doing nothing to tackle the affordable housing crisis or level up.”

Mark Hayward, chief policy adviser at Propertymark, which represents estate and letting agents, said: “A greater supply of homes will serve to correct the imbalance between supply and demand which has been intensified by the stamp duty holiday.

“The Government has made a number of announcements in the past on simplifying the planning process; however, this will only work if it really reflects local needs and demands.

“We hope the Planning Bill outlined today encourages the development of housing in more affordable areas as, at the moment, most of the development taking place is in areas that are unaffordable to first-time and lower income buyers.”

The leasehold system will also undergo an overhaul.

The Leasehold Reform (Ground Rent) Bill covering England and Wales will ensure leaseholders of new, long residential leases cannot be charged a financial ground rent for no tangible service.

Ground rents will be set in law at a “peppercorn rent” level – meaning that nothing more than a literal peppercorn can be sought from leaseholders.

Freeholders breaking the new rules by charging ground rent could be fined up to £5,000.

In the past, some leaseholders have faced spiralling ground rent charges and have been unaware of the costs they were taking on when they bought the property.

There will be exemptions to the new rules in a few cases, including business leases, to allow people who need to live in the same premises as their workplace to continue to do this; and some parts of the community-led housing sector, so they can retain the right to levy ground rent to maintain their ability to further promote community activities.

Mr Hayward continued: “The issue of escalating ground rent on leasehold homes has been a long-term scandal which has left many owners trapped and unable to sell their homes.

“Our Leasehold: A Life Sentence research conducted in 2018 found that 46% of leasehold house owners were unaware of the escalating ground rent when they purchased their property.

“Over one million households in the UK are sold as leasehold, and this legislation will go a long way to help thousands of home-owners caught in a leasehold trap.

“However, while this is a step in the right direction, we encourage the Government to extend this to those who already own a leasehold property as well as all retirement properties, to create a level playing field.”

Later this year, the Government will outline proposals for a new “lifetime” tenancy deposit scheme in England, which promises to ease the burden on tenants when moving from one tenancy to the next.

It also plans to drive improvements in standards in rented accommodation.

Polly Neate, chief executive of Shelter, said: “The Queen’s Speech offers fresh hope to England’s 20 million private and social renters. Today, we are one step closer to ensuring every renter can have a decent place to call home.”

Ben Beadle, chief executive of the National Residential Landlords Association, said: “Lifetime deposits for tenants provide an opportunity to reduce the upfront cost of renting, but they need to work for all concerned.

“We welcome also the Government’s ambitions to drive out bad landlords from the sector without penalising those who do the right thing. We want to root out all those who bring the sector into disrepute.”