The construction industry has reacted with a range of positive and negative statements to the changes announced to the National Planning Policy Framework, which could have major implications for the housebuilding sector in 2025, although there remain several areas which require further clarity. With the HBF reporting that new build completions saw a significant decline of 6.5% over 2024, the sector faces a raft of challenges which the NPPF tweaks are designed to ease, including £100m of funding for local authorities to complete their plans for development.
Further clarity is awaited including precise definition of what will constitute ‘grey belt’ development, as well as how the new standard method for calculating need will play out in reality. However, Robert Gowing, Planning Partner at legal firm Eversheds Sutherland said that “many should welcome the amendments and refinements made to the definition of ‘grey belt’ as it now makes more clear it can be any green belt land (whether or not it was previously developed), and that it only needs to be shown to not strongly contribute towards any of 3 of the 5 green belt purposes” [rather than a limited contribution to all five as previously proposed.
Commentators mentioned the challenge of local mandatory housing targets, and many welcomed the “presumption in favour of sustainable development,” as well as recognition of the importance of SME housebuilders in delivering the homes needed, and the need to recruit many more than the 300 extra planning officers pledged by the Ministry. In addition, the broadening of brownfield definitions and the focus on more affordable housing (albeit with local discretion) as a “golden rule” of potential grey belt development were welcomed, as was the focus on pushing sustainable drainage and transport provision.
However, as some commentators mentioned (for example Sav Patel, associate director of Lanpro) mentioned, areas which have their housing targets increased in line with unaffordability and therefore the “greatest potential for growth” could lead to disproportionate numbers of developments. This, said Patel “could cause friction with local communities many of which are reluctant to see more development in their areas – such as parts of the South East and East of England where Labour made substantial gains at the last General Election.”
Questions around affordable homes provision were raised by several commentators, such as Alun Williams, partner at law firm Spector Constant & Williams, who said: “An area of concern for developers will be how the viability tested provision of Affordable Housing is dealt with. Where a scheme is assessed as sustaining less than the appropriate threshold, will this still result in a referral to committee or will the planning officer have sufficient discretion to approve the application?”
Timothy Douglas, Head of Policy and Campaigns at Propertymark, commented that there could not be a one-size fits all housebuilding approach, despite the need for urgency: “An infrastructure-first approach is key to delivering the homes the country desperately needs. Whilst mandatory targets focus minds towards achieving a goal, a one size fits all approach to housing delivery will not be enough if the UK Government are to hit their ambitious housing targets. More must be done to work with local authorities to ensure there is the capacity, political will and buy-in from local communities to build in more areas across the country.”
Eversheds’ Robert Gowing said that in bringing requirements on local plan making into effect from 12 March 2025, the Government “clearly expects local authorities to pull their socks up and embrace the changes. For those councils who anticipated that some sort of transitional arrangement might give them extended breathing space before needing to tackle the new housing targets, they will be disappointed.”
Dr Victoria Hills, Chief Executive of the Royal Town Planning Institute, welcomed the changes however: “The Government has heard the concerns of planners and has responded with additional resources to strengthen the planning system. This is a clear and welcome recognition of the critical investment needed to meet ambitious housing and climate targets.”
She also admitted there remained challenges, but that the Government’s softened approach on affordable housing will be welcomed by planners: “Sites released through the grey belt process must benefit communities as a whole. We are pleased that the government responded to our concerns over the blanket 50% affordable housing requirement and is now allowing for local variations.”
Hills concluded: “The key to success for the government’s new national planning policy will be England-wide strategic planning. However, we will face a period of uncertainty as local planning authorities navigate their crucial role in the government’s plans.”
By contrast, Elizabeth Froude, Group Chief Executive at Platform Housing Group said that she was disappointed that there was “no mention of setting any increased need for more affordable housing on greenbelt land; this is clearly very disappointing for housing associations as it will prevent increased levels of new affordable homes being built.”
Allisson Whittington, Head of Housing and Health at Zurich UK warned the Government not to fast-track planning decisions at the expense of resilience: “We would caution against rushing planning decisions and pressing local authorities to build on areas, such as floodplains, that might not be sustainable.”
She continued: “We need to build resilient homes that we can be proud of in years to come and that will combat the rigours of everyday life.” adding that housing associations “need the right support in place to enable them to continue to play their part in creating homes for all.”
The Federation of Master Builders welcomed the changes generally, including the “pragmatic approach to the green belt and local targets,” but said that the lack of “revision of the small site allocation in local plans” within the changes announced “is going to come as a disappointment for small house builders.”
Brian Berry, chief executive of the FMB, said: “The Government’s reforms must be seen as the start of the process to help diversify an increasingly restricted housing market, as the current changes don’t shift the dial enough for micro house builders.”