Simplifying planning with a new ‘medium’ sized definition for sites of ten to 49 homeswill enable SMEs to be major players in delivering 1.5m new homes, asserts the construction industry.
A new government working paper on reforming site thresholds suggestssuch sites be exempt from the building safety levy and benefit from simpler biodiversity net gain rules.
Deputy prime minister and housing secretary Angela Rayner said smaller housebuilders were key to helping the government reach its target of 1.5m new homes by 2029.
“For decades the status quo has failed them and it’s time tolevel the playing field.
“We’re taking urgent action to make the system simpler, fairer and more cost-effective, so smaller housebuilders can play a crucial role in our journey to get Britain building.”
The National Federation of Builders, NFB, said the proposals, released on the 27thof May, would give the SME sector the support they needed to survive.
NFB and house builders’association policy and market insight head Rico Wojtulewicz said:“A medium sites definition supports projects SME builders typically deliver. If you support more SME builders, you encourage more entrants into the market. It’s a really sensible strategic move.”
Brokers Hank Zarihs Associates said development finance lenders backed lessening the regulatory burden as SMEs couldn’t afford extended delays on projects.
In 1998 SMEs built 39 per cent of new homes but this has declined to just 10 per cent, revealed a research paper by the built environment committee. The government has recognised that SMEs contribute to local jobs as well as training eight out of ten construction apprentices.
The working paperis proposing applications for sites of less than ten homes be delegated to planning officers rather than planning committees. It also suggests streamlining or exemption of biodiversity net gain, BNG, where builders must deliver a ten per cent uplift over a 30-year period.
Biodiversity rules to become less burdensome
BNG became mandatory for major developments on the 12thof February 2024 and for smaller sites on the 2ndof April 2024 as part of the 2021 environment act.Small sites could use a digitised habitat metric which included gardens and features such as bat boxes and bee bricks. However, developers of sites with ten or more homes had to employ an ecologist to assess the existing biodiversity of the site and how to deliver the ten per cent uplift.
The BNG rules have eaten into profit margins adding an estimated £200,000 in costs for a development of 40 new homes.
Mr Wojtulewicz said if thehabitat metric was extended to developments of up to 49 homes, then this would provide sites large enough to discover whether features such as bat or bird boxes worked.
He also said that a medium site definition would help with the development of brownfield sites as smaller schemes would benefit from a streamlined planning process and would be quicker to deliver.
The government said it would ensure Homes England would release more of its land exclusively to SMEs and a new national housing delivery fund would support long-term finance options.
Small sites aggregator pilots would be launched in Bristol, Sheffield and the LondonBorough of Lewishamto unlock unviable small plots of land.
LinkedIn Question: Is a new medium site definition offering simpler planning and environmental regulatory rules enough to save the SME housebuilder?
