The recent consultation on revisions to the National Planning Policy Framework (NPPF) includes new details regarding viability assessments and Green Belt land release.
The Proposed Change
Under the revised guidance, benchmark land values for viability assessments must be established based on the existing use value plus a reasonable and proportionate premium for the landowner. Local Authorities are required to set these benchmark land values, taking into account local material considerations.
Local Authorities are empowered to deny planning permission if land released from the Green Belt is sold above the benchmark land value and therefore cannot deliver policy-compliant development.
Where a policy-compliant development can be delivered, a viability assessment would be unnecessary. Higher levels of affordable housing cannot be proposed and then justified on viability grounds.
If land is sold below the benchmark land value but still fails to support policy-compliant development, the applicant must demonstrate the need for a viability assessment during the application stage.
The weight given to this assessment will be at the discretion of the decision-maker, looking at all the circumstances of the specific case, including whether the Plan and its supporting viability evidence are up to date, or any changes since adoption.
In cases where viability negotiations have led to reduced policy delivery, a late-stage review should be conducted to determine if additional contributions are needed, this will usually be set out as a mechanism within a S106 Agreement.
Will It Work?
This new and unique approach aims to prevent inflated land prices from undermining affordable housing delivery. The effectiveness of these changes will depend on how Local Authorities set benchmark land values and what happens if they fail to do so.
The Take Home Message
Developers should not assume that a default viability position will be accepted when purchasing land, particularly within the Green Belt.
If you have questions about how these or other proposed reforms might impact your development pipeline, please contact the team at Barker Parry.
