Earlier this year the Government issued a consultation about changes to planning policy affecting the 'Build To Rent' sector. The consultation received responses from a variety of stakeholders ranging from private individuals to local authorities as well as developers and investors.
An overwhelming majority of respondents supported the specific recognition of Build To Rent and Affordable Private Rent by means of their inclusion as defined terms into the National Planning Policy Framework (NPPF) which would recognise its benefits at a national level and encourage Local Planning Authorities to consider it when assessing the delivery of housing within their areas.
The consultation generated much discussion about a few specific issues, in particular:
- whether there should be a requirement for all Build To Rent schemes to have a minimum of 20% Affordable Private Rent units at a 20% discount below the market value
- most respondents were of the view that flexibility should remain, allowing for negotiation as to the exact requirements of any Affordable Private Rent units, depending on local needs and the viability of schemes
- whether planning authorities should be able to specify minimum tenancy lengths of three years. 64% of all respondents were in favour of this, with local authorities particularly positive
- the use of claw-back clauses as opposed to covenants on the land as a mechanism for ensuring that units remain in the private rented sector. Just over half of all respondents favoured this.
Tom Willows, Partner, said:
"Despite the clear support for the introduction of definitions of "Build To Rent" and "Affordable Private Rent" into the NPPF there is still no agreement regarding the ambit of those definitions. The Government is now moving to finalise these policies and whilst certainty is beneficial, any policies which are too prescriptive risk deterring investment. However, since the close of the consultation more schemes have been announced throughout the UK and stakeholders in the real estate sector are increasingly building specific Build To Rent capabilities, demonstrating the rapid sector growth and potential opportunities despite the current uncertainty."