Monday, 14 December 2015

Sorry, Policy Network, but development control is not the planning system


How people misunderstand the planning system:

If the planning system were the key constraint then one would expect to see housing start statistics on par with the number of agreed permissions, but clearly this has not been the case. Moreover, this means that since 2006 a large proportion of plots with planning permission has accumulated and not been used. Based on the data compiled, this figure is now close to 800,000 units and continues to rise. If local authorities grant permission for a similar amount of plots in 2015 as they did last year, then England already has over a million plots with planning permission to build on.

This is all true. But it doesn't describe the efficiency or effectiveness of the planning system. What it describes is the efficiency of our development control process and the fact that land with a planning permission is more valuable than land without a planning permission. So the idiots who don't see planning as the problem then propose a process whereby the uplift in value from agriculture to housing doesn't fall to the landowner but to "the community". All this means is that people stop seeing the sale of agricultural land for housing as worthwhile - we have less land than we have now on which to develop. Moreover the developers are unable to use the land value as the collateral for development finance - meaning that financing costs rise considerably removing a chunk of the supposed community benefit.

The problem is more profound than this though because a lot of the sites that aren't being developed aren't agricultural land but urban brownfield. And much of this is in places where people don't want to live (and therefore where housing values are low). I know of one development on a previously developed urban site where local housing values - around £120,000-150,000 for a typical three-bed family home - simply don't allow for a viable development even where land value is zero. Developers won't develop at a loss and won't develop in places where they feel they would find it difficult to sell the homes they build.

If you focus on development control then there doesn't appear to be a problem. But if you look at the local plan process - the land allocation part of the system - then we see too little land allocated in high demand areas and too much land allocated in low demand areas. Mostly because our system of objectively assessing need takes no heed of market signals - the things that make a three-bed semi in Sevenoaks cost £625,000 while one in Bradford is just £155,000. And this problem is entirely - or as near as makes no difference - down to the planning system.


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