Government pushes planners to move housebuilding from countryside to cities

Following a backlash from Tory MPs over fears of the impact of new housebuilding in their constituencies, the Government has announced new planning regulations which will prioritise building homes in city centres rather than in rural areas.

Senior Tories such as Theresa May objected to what was described as a “mutant algorithm” previously used by the Department of Communities and Local Government to calculate local housing supply needs, which would have seen thousands of houses constructed in more rural areas. Secretary of State for Housing Robert Jenrick this week announced an “updated method to help councils to enable the delivery of 300,000 homes a year by the mid-202s, while prioritising brownfield sites and urban areas.”

The proposals, announced following a wide consultation over the summer, encourage city councils to plan more family-sized homes in their areas, and to “make the most of vacant buildings and underused land to protect green spaces.” The plans focus on England’s 20 “largest cities and urban centres” and push for reuse of empty office and retail units in town centres.

The DCLG also said that it intends to review the ’80/20 rule’ which guides how much funding is available to local authorities to help build homes, to balance funding across the country.

Robert Jenrick commented: “The Covid pandemic has accelerated patterns that already existed, creating a generational opportunity for repurposing offices and retail as housing and for urban renewal.”

He added: “We are reforming our planning system to ensure it is simpler and more certain without compromising standards of design, quality and environmental protection.”

In January the Government plans to launch a £100m Brownfield Land Release fund to support brownfield development and estates regeneration, as well as development on public sector land and self and custom-build serviced plots. This will be open to councils across England. New chair of Homes England, Peter Freeman, will sit on a new urban centre recovery task force to develop and regenerate England’s major cities.

FMB chief executive Brian Berry said: “Building on brownfield land helps protect green spaces while unlocking the new homes that we desperately need. Small to medium-sized housebuilders train 71 per cent of apprentices and build high-quality homes, so making the funding accessible to them is crucial to building back better.”

He added: “Under the 80:20 rule the majority of Homes England’s funding went to the least affordable, and often most affluent, areas.”

Melanie Leech, chief executive of the British Property Federation commented: “We welcome the Government’s focus on new housing delivery in urban areas and making best use of brownfield land, and the recognition of Mayoral Combined Authorities as trusted delivery partners and that all housing tenures will play a key role in achieving these ambitions.

“Build-To-Rent works particularly well as an urban, brownfield product, and has seen strong growth across the regions in recent years – with 26,500 new BTR homes currently completed and 68,500 under construction and in planning in cities.

“It is hugely positive that the Government will revise the 80/20 rule – any housebuilding should have access to government support to ensure that wherever you live, you get the essential infrastructure that supports housing growth.

“The challenge, however, is that housebuilding alone will not ‘level up’ the north. This will no doubt be a priority for the Urban Centre Recovery Task Force and we look forward to working with Peter Freeman at Homes England, to take this forward.”

Jamie Johnson, CEO of FJP Investment said: “It is positive to hear that the Government remains committed to its target of 300,000 new homes. Obviously, this requires significant investment in regional cities where demand for residential property is growing at remarkable rates. Often, these are overlooked, which is why the decision to promote construction of new builds in the north and the Midlands will be welcomed by their local communities.

“I anticipate demand for property in places like Newcastle and Liverpool to rise in 2021. Already, construction firms are working to make up for the delays caused by the pandemic to ensure that projects in these cities can be delivered on time.

“The Government needs to ensure today’s announcement is part of a long-term strategy that helps with the overall upgrade of regional Britain.”