P2P real estate platforms call for urgent planning reform
Peer-to-peer home lending platforms have called for a sweeping reform of house building planning after the topic was left out of the Queen’s Speech.
Stuart Law, managing director of Assetz Capital, said the planning system acts as a barrier to development, especially for small and medium-sized enterprise (SME) builders who struggle with the cost and time required to successfully navigate in the process.
The Queen’s Speech mentions a planning bill and indicates that some proposed aspects of planning reform were published in the government’s Leveling Up white paper in February, but did not specify what the next steps.
Law said he was disappointed that a key approach was not mentioned in the speech and said urgent sweeping planning reform was needed given the huge demand for new build homes and the rise costs.
Assetz found that growing demand for new homes led to a 14% difference in price growth for new and existing homes in the fourth quarter of last year.
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“The absence of a clear and comprehensive approach to planning reform was a notable omission in today’s Queen’s Speech,” Law said.
“Given the huge gap between supply and our national housing needs, I had hoped that planning reform would feature more prominently on the legislative agenda ahead.”
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Lee Birkett, chief executive of JustUs, agreed that urgent planning reform was needed.
“At the moment the planning system is broken, it’s done by local councils with their own interests at heart and it needs a comprehensive nationwide reform,” he said.
“It should be taken out of the councils and there should be a clear set of rules and guidelines and if a proposal meets the criteria it is adopted. At the moment, these are more people’s opinions.
February’s Leveling Up white paper said the government aims to transform the planning system in the UK by expanding opportunities in all parts of the country.
The newspaper says the government is developing models for a new infrastructure tax and will provide further support for the reuse of brownfields for development.
He also said councils and communities will create new local design codes to shape streets according to residents’ wishes and expand the accessibility of neighborhood planning.
Law said he wanted to see more details because so far it doesn’t look like the reforms are sweeping enough.
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“While it is vital that new developments are sensitive to and enhance local communities, local design codes will also add another hurdle for homebuilders, adding to construction costs that are already exorbitant due to the inflation, the energy crisis and the long-term impacts of Brexit and Covid19,” he said.
“We will of course have to see exactly what future legislation will look like. But from what we’ve heard today, it doesn’t appear that the reforms are sweeping enough or moving forward with enough urgency to help address key challenges facing homebuilders or deliver significant numbers new homes to meet demand and moderate price growth.