Validation Issues, Dwelling Mix Reviews and The Government’s Executive Summary Template…
This note provides an update on some key issues that we have identified in the development viability arena, following both the change in guidance in July 2018 and the prevailing economic market conditions.
We are experiencing the following:
• Validation Issues – In light of last year’s revised viability guidance, an increasing number of Local Authorities are requiring viability assessments to be submitted by applicants at the same time as the planning application, to ensure that planning applications are validated. Typical practice previously was to submit viability assessments after planning applications had been registered and validated. Developers/housebuilders should be aware of this important change, as the requirement for a viability assessment up front can have a significant implication on the timescales for determining planning applications. Hence, viability assessments should be prepared so that they are ready to be submitted with planning applications.
• Dwelling Mix and Help to Buy – We are increasingly seeing more apartments and smaller two/three-bedroom scheme compositions being included as part of developer’s proposals, at the expense of larger executive family housing. This is both for new planning submissions and the increasing trend of re-plans of extant planning permissions. Volume housebuilders are reassessing their private housing mix targets in response to the regional Help to Buy eligibility caps being introduced by central government from May 2021.
The Help to Buy price caps are as follows:
| NEW HELP TO BUY REGIONAL PROPERTY PRICE CAPS | |
Region |
Price cap for properties eligible for Help to Buy Equity Loan scheme from April 2021 to March 2023 |
| North East |
£186,100 |
| North West |
£224,400 |
| Yorkshire and The Humber |
£228,100 |
| East Midlands |
£261,900 |
| West Midlands |
£255,600 |
| East of England |
£407,400 |
| London |
£600,000 |
| South East |
£437,600 |
| South West |
£349,000 |
• Development Viability ‘Executive Summary’ Template – The Planning Practice Guidance (updated July 2018) stated that central government would be producing a template Executive Summary for development viability assessments in Autumn 2018. To date, the template is yet to be published.
For further advice on the impact of the above on your next development viability assessment, please contact either Nigel Simkin MRICS or Adrian Willet FRICS on the details below:
Nigel Simkin MRICS – Director
M: 07854 836811
T: 0121 740 0591
E: nigel.simkin@hld-uk.com
Adrian Willet FRICS -Director
M: 07979 474744
T: 0121 740 0579
E: adrian.willet@hld-uk.com
Disclaimer
No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of Highgate Land and Development. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. No liability for negligence or otherwise is assumed by Highgate Land and Development for any loss or damage suffered by any party resulting from their use of this publication.