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Good news for developers of smaller residential sites!

Good news for developers of smaller residential sites!

The Government has recently won a legal challenge against a High Court ruling that quashed a national planning policy intended to exempt small sites from affordable housing obligations. The Policy means affordable housing contributions will fall to developers building the largest sites while those smaller builders developing sites of 10 homes or fewer will not have to make provision within their proposed schemes.

The decision has been welcomed by small developers and builders as the obligation to provide affordable housing added an additional layer of complexity to what is already a complicated planning process. In the smallest schemes the required provision might have been as little as a single unit, however this often had the knock-on effect of materially affecting values of the private housing and in some instances made the development unviable altogether (unless the land could be acquired for a lower price). Furthermore a single unit within a scheme would be less attractive for the potential purchaser (often a housing association) who generally prefer to acquire units in larger numbers as they are more cost effective to manage.

However, developers must still factor in CIL (Community Infrastructure Levy) contributions when appraising sites for development – a system which applies a fixed rate (per square metre) to the total gross internal floor area of the development and which in part replaces the earlier regime where there would be liability to make various individual Section 106 contributions towards highways, transport, public open space, community facilities etc. The charging rate in the wider Salisbury area will typically be £85 /sq m unless the development falls within one of the specific ‘Zones’ in which lower rates can apply.

The commercial department has recently sold a prominent former garage site of 0.16 acres on the City’s ring-road at the junction with the A36 Wilton Road to a local developer who intends to build out a high quality flat scheme. A price of £700,000 was quoted. A former workshop site just south of Swindon with detailed planning permission for 11 new homes has recently gone under following marketing at an asking price of £1m.

There continues to be strong interest in small sites and similarly in conversion opportunities particularly those where the opportunity exists to develop out the scheme under the permitted development regime which involves a ‘prior approval’ process with the relevant local authority.

Rob Horton
Written by

Rob Horton


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