Different ways to bring forward land

KEY LEARNING POINTS

  • Area-wide allocations and the effective use of settlement boundaries can help ‘shake out’ building plots and meet local demand
  • Proactive engagement with neighbouring local landowners and the ‘pooling’ of land can unlock new opportunities - this approach is used effectively in many other countries, particularly Germany
  • Vacant land in the heart of towns and villages can help identify opportunities and can be an alternative to settlement expansion
  • Starter Homes policy can help deliver opportunities for private homebuilders
  • Exception sites can be used to help bring land forward - even outside rural areas
  • The Homes and Communities Agency can help identify suitable surplus public sector land sites which could be sold for private homebuilding
  • Garden Cities, Suburbs, Towns and Villages offer larger scale opportunities for private homebuilding

INTRODUCTION

Securing suitable land in the right locations, and the challenges associated with the planning process are the two biggest hurdles for private homebuilders. Although some councils are taking significant steps to facilitate more private homebuilding through their local plans and other initiatives, others have so far taken little to no action. Many remain unclear about how to proactively facilitate opportunities and others are unsure about what might work best in their local circumstances.

We have prepared a series of Briefing Notes that provide advice on how councils can use the planning system to enable more people to build their own homes. These Notes also describe what some councils are already doing and the role that affordable housing and rural exception sites can play in this process. To explore these issues further please see the following: -

This Briefing Note highlights some other approaches - including several innovative techniques used abroad - that councils could employ to bring forward land for private homebuilding.

INTERNATIONAL APPROACHES

Allocations

About one in four councils in England is currently identifying private homebuilding opportunities on land allocations in their Local Plans. Most of these are identified as either broad locations for growth or through site specific policies for allocated housing sites. Area-wide housing land allocations that endorse the principle and form of development are currently not widely used in the UK, but could potentially have a positive impact on releasing more housing land.  This approach is advocated in our Briefing Note on How the planning system can generate opportunities and can help ‘shake out’ private homebuilding opportunities.

The approach to area-wide housing allocations is widely used in Germany with considerable success. German preparatory land-use plans (‘Flächennutzungsplan’ or FNPs), which all councils have to prepare for their areas, outline the future use of land. Once the plan is adopted it establishes the principle use of the land (ie. zoned for different types of housing, open space, commercial uses, agriculture, forestry). It also guides the preparation of more detailed ‘Bebauungspläne’ (B-plans) which can be prepared for any areas of change or new development.

Development that accords with the allocated zone is considered favourably in principle, although a planning application (building permit) is still required. Once adopted the plan is kept under review.

When a German council looks at the need for future residential development in its area it will take into account future housing need and demand assessments.  It can then alter the FNP, and it will assess the number of additional homes that will come forward as a result of the changes it makes to the plan.

For example, the rural council of Neuenkirchen-Seelscheid uses its FNP to identify infill opportunities to accommodate future housing need instead of promoting large-scale greenfield developments. The FNP identifies existing and new housing areas, and potential extensions, and these are given an area-wide zone status that supports different types of residential use. In zoning such areas the council also estimates the number of new homes that could come forward.

The effect of this approach is that it provides considerable certainty to landowners and private homebuilders that the principle of a development is acceptable. It also incentivises landowners to bring new land forward for development.

This approach is similar to proposals in the new Housing and Planning Bill. If implemented, they will have the effect of councils granting permission in principle for new homes on land that has been designated in development plans. The new Bill also proposes to grant "automatic" permission on allocated housing sites (where certain criteria are met).

The preparatory land-use plan for the rural Neuenkirchen-Seelscheid district The preparatory land-use plan for the rural Neuenkirchen-Seelscheid district showing area-wide residential land allocations in brown that span across its tightly constrained residential areas

Effective use of settlement boundaries to promote development

In Germany, in areas where there is not a B-Plan, development proposals must be assessed depending on whether they fall within the built-up area or beyond.

Section 34 of the Federal Building Code says that development in built-up area is permissible provided it ‘blends in’ with the character of the immediate surroundings. The land use zoning of the site is also taken into account and local public infrastructure provision also has to be secured.

These built-up areas are commonly known as ‘Section 34 areas’. A typical committee report for a new home proposed under these rules is shown below.

Proposals for a new home in a Section 34 area Proposals for a new home in a Section 34 area are usually approved if they blend in with the character of the neighbourhood

Proposals for development outside the built-up area on-called ‘white land’ are not normally permitted (also commonly known as ‘Section 35 areas’).

New development may be permitted in exceptional cases provided that it doesn’t conflict with any public interests and public infrastructure provision can be guaranteed. The proposed use is also restricted (for example agricultural or forestry, market-gardening, or related to the supply of public utilities such as electricity). Conditions are less stringent for the redevelopment and reuse of existing buildings.

To enforce these legal provisions and provide clarity between what is in and what is outside the urban area most councils actively designate settlement boundaries by adopting a ‘boundary statute’ (Abgrenzungssatzung). Once set these can be adjusted to create new development opportunities (or restrict development).

For example, in Neuenkirchen-Seelscheid the council actively adjusts its settlement boundaries to enable small-scale residential developments and to create opportunities for local people to build their own homes (see example below). The council has intentionally pursued this approach as an alternative to larger scale greenfield allocations and the preparation of new B-Plans. This has spread development evenly across the district and, in the council’s opinion, is more acceptable to local people.

Neuenkirchen-Seelscheid Neuenkirchen-Seelscheid council has enabled a significant number of permissioned serviced building plots by adjusting settlement boundaries and identifying area-wide housing allocations in its preparatory land-use plan

How could these approaches be applied in local authorities in England?

These approaches are particularly suitable for councils in rural areas, councils that have limited land supply, or local authorities where the housing strategy seeks to disperse development across the district. They could also be of interest where towns and villages have development opportunities within or on their edges.

Some councils intentionally remove settlement boundaries in their Local Plans and ‘wash over’ settlements with countryside designations such as Green Belt. This has the effect of stopping all development opportunities within and on the edge of settlements because new homes would be subject to countryside designations (even where a development is small in scale, located between existing buildings or enables the redevelopment of existing buildings). It can also lead to protracted planning applications and create considerable uncertainty for landowners and communities.

By making effective use of settlement boundaries and area-wide allocations councils can introduce greater certainty about the acceptability of new housing and ‘shake out’ new housing sites to help meet the need for more housing.

This approach would be compatible with Government policy in the NPPF which says that the supply of new homes can sometimes be best achieved through planning for extensions to existing villages and towns. Planning authorities with Green Belts in their area are also asked to establish Green Belt boundaries in their Local Plans which set the framework for Green Belt and settlement policy.

Potential rural village extensions like this could easily unlock several new housing opportunities for private homebuilding without encroaching into the surrounding countryside Potential rural village extensions like this could easily unlock several new housing opportunities for private homebuilding without encroaching into the surrounding countryside
Many locations on the edge of towns and urban areas are subjected to countryside designations which blocks even small scale infill development that would not impact on the openness of the countryside. Many locations on the edge of towns and urban areas are subjected to countryside designations which blocks even small scale infill development that would not impact on the openness of the countryside. Carefully considered area-wide allocations or settlement boundaries can often help unlock new building plots for new housing and private homebuilders

About

This is one of many Briefing Notes that explain resourcing, planning, land, finance, demand, marketing, consumer support and various technical issues. To see the full range of guidance click here.

Definitions

For the purposes of this Toolkit we have made the following definitions:

NOTE

This Briefing Note will be revised when the Regulations to support the commencement of the Self-build and Custom Housebuilding Act 2015 and the Government’s Right to Build policy are finalised.

Land pooling

In Germany, the Netherlands, France, Spain, Australia, Japan and Korea it is common to ‘pool’ land (where there are multiple adjoining landowners) to facilitate new development opportunities.

The approach (also sometimes called ‘land readjustment’ or ‘land reallocation’) is based on landowners collaborating in the assembly, servicing and disposal of land so they all benefit from the uplift in land values once the site receives planning permission.

In the UK housebuilders and developers routinely do this. However, it is much less common for UK councils to directly assemble land to create development opportunities, and, where they are involved, it is normally in response to private sector proposals or through the use of compulsory purchase powers. Councils have traditionally left the assembly of land to the private sector and then manage the form of the development though the planning process, often by imposing planning obligations.

The following boxed texts summarise approaches in the Netherlands, France and Germany:

THE NETHERLANDS

In the Netherlands councils have powers to purchase undeveloped land, install services and parcel it up for sale. They can use pre-exemption rights (compulsory purchase) to designate an area for development. This forces a landowner who wants to sell land to initially offer it to the local council. The council may then buy it at existing land use value (often just above agricultural value, as it tends to be land owned by farmers). It then provides the infrastructure and sells plots at a price that covers its costs.

The system enables councils to: -

  • Buy cheap land for servicing and disposal
  • Sell plots to private developers and/or private homebuilders at full development value
  • Recover the costs of bringing land forward

FRANCE

France uses land pooling on a voluntary basis rather than through a legally binding mechanism. Large housing sites are assembled alongside an infrastructure plan – this de-risks the site and creates certainty.

Councils have rights of pre-emption to buy development land. These are linked to the publication of the local plan and give councils an option to buy land at prices up to a stipulated upper limit. The limit is linked to the price that would be achieved under a compulsory purchase. This mechanism provides local authorities with a potentially powerful land policy instrument.

It can, however, work against them. If the local authority does not take up its ‘right to buy’, then the local plan designation for the land will change to a ‘normal private land use’ allocation. If the local authority exercises the right, but does not develop the land within five years, then the original owner has a right to buy back the land. This buy back right is, however, rarely used.

GERMANY

Land Pooling and Reallocation

In Germany many councils use a formal and legally binding process of ‘land pooling’ and ‘reallocation’ (Umlegung). The process starts with the municipality formally designating an area for pooling. This takes account of the location, size and shape of the site and how fragmented the land ownership is (the more landowners the more complex the process).

The property rights and claims of all individual plots are added together and the site is planned for redevelopment to create developable building plots following the normal planning process. The council appropriates the land identified for streets and other public spaces from the total area.

The remaining land area is then returned to the original landowners according to their share of either the original value or land area. If allocated by land value the landowner has to pay the uplift in value - between the original land value and the new land value - to the council. This is because serviced land commands a premium in the market and means the council can recoup the costs of infrastructure which needs to be installed to bring the land forward. Compulsory purchase can be used but in many cases it is not necessary as the process benefits the landowners.

To stop land speculation the reallocation is usually initiated before the development plan for the area is changed to designate the site for housing. This enables the pooling to take account of the original value of the land. The alteration of the development plan needs to then be completed before the proposed development can be implemented.

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The value of the land increases for all the owners as the land is serviced

German councils frequently use this process to bring forward new building plots for local people to build homes. Where the council owns part of the land that is being pooled it often sells these plots at reduced prices.

Annex 1 has more information about the process.

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Diagrammatic representation of the German land pooling and reallocation process

Bonn City Council has used this process many times to bring forward new housing land and typically has two or three different areas being assembled at any one time. This is not uncommon for many larger councils in Germany.

The following short case study describes how land pooling is applied in a specific case in Germany:

CASE STUDY – AM HOLDER in ROTTGEN, GERMANY

One of Bonn’s most recent projects has involved the assembly of a 25 hectare site in Röttgen on the edge of Bonn to create 186 serviced plots for 300 homes along with a new kindergarten and public open space.

The ‘Am Hölder’ site was formerly low-grade agricultural land, owned by 80 different people, including the council. After extensive negotiations with the landowners the council resolved to use the land pooling and reallocation process to plan a new urban extension to accommodate much needed housing. There was widespread support for the development because of the economic boost it would provide to the area, and because local people would be able to acquire a plot to build an affordable home.

Because of the scale of the site and the number of landowners involved the process took about six years to complete. The initiative was administered by an independent reallocation committee (Umlegungsausschuss) made up of a chairman, two local councillors, one surveying expert and a valuer appointed by the council. The committee operated as a non-public forum and its brief was to deliver the council’s objectives for the area.

Based on the land that the council owned across the site it was able to deliver 52 council-owned plots for family housing and some apartments. The other plots were reallocated to the original landowners, and some of these have been sold or developed by them.

Plot sizes range between 300 and 450 sq m. The council’s estates team has administered the sale of its own plots at fixed prices – these were advertised in the local media and on the council’s website. The prices range from €165,000 to €215,000 (this includes the land and all servicing costs).

The council applied specific local criteria for the sale of its own plots to deliver Starter Homes - these included a preference for younger families (ie. families with children under 18 where both parents are under 40 years old), those who are first time buyers and those that live in the wider Bonn area.

Plots are normally sold freehold, but leasehold options were also possible.

Successful applicants were required by deed of sale to: -

  • Complete the plot purchase within 10 months
  • Submit building plans for the home within six months of purchase
  • Start construction within six months of building control/planning permission
  • Complete the build within two years
  • Build a sustainable home (to a specified energy efficiency standard) - enabling applicants to secure a €18,000 low interest Government loan
  • Remain in the property for at least five years and certify that it will not be sold or rented within five years of completion. Penalties are applied for non-compliance and the council is entitled to claw back the property. If changes in personal circumstances force the owner to sell or rent the council can vary these restrictions

 Some of the council owned land has been sold directly to local builders for the construction of apartments. To secure the purchase builders needed to demonstrate how they would create affordable accommodation for local people (social housing requirements are still to be determined by the council).

The estimated council income from 52 plot sales on the site is about €8.58m (excluding service/admin costs etc.).

The development has been highly successful. Across the whole development around 85 plots were sold within six months of coming onto the market, and the first homes were nearing completion three months later.

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Land pooling in action in Röttgen on the edge of Bonn. Fragmented land ownership made development of this former farmland difficult so the council worked with more than 80 landowners to plan a new urban extension to create some 180 building plots. The council planned and serviced the site, recovered its costs and land owners were reallocated plots equivalent to their original land ownership
Urban Development Measures 

German councils can also formally designate ‘urban development zones’ and use ‘urban development contracts’ to develop green field or large brownfield sites for housing. This enables councils to purchase land and bring forward building plots at relatively low prices.

However these measures can only be used to serve the public interest – so, for example, to meet demand for housing or employment, to deliver public amenities and associated facilities, or to return derelict land to productive use.

One of the benefits of using these measures is that councils are required to swiftly draw up binding land-use plans for the area so that development can be speedily implemented.

These measures are normally financed by the uplift in the land value of the plots.

CASE STUDY – ALTONA REDEVELOPMENT, HAMBURG

Urban development measures are being used to redevelop the 75 hectare former D-Bahn site at Altona in Hamburg. Twenty percent of the first phase has been allocated for building group projects, and the development will eventually provide 3,500 new homes alongside commercial, mixed use and education floorspace.

The council has already identified the first three groups and will be awarding four further parcels of land in the near future - three for co-operative groups (each of 40-55 homes) and one for direct ownership (of 30-35 homes).

1

How could these approaches be applied in local authorities in England?

Councils that encourage and work proactively with landowners can bring forward new opportunities for housing, including private homebuilding.

Where land ownership is fragmented councils can play a proactive role in unlocking opportunities.

Although there are no formal legal land pooling and urban development measures currently available to UK councils (other than compulsory purchase powers) councils can still take action - for example by pursuing joint ventures with landowners or facilitating opportunities with housebuilders and custom build enablers.

TOP TIP 

Use area-wide allocations and settlement boundaries

Area-wide policies or allocations and adjustments to settlement boundaries can help bring forward plots for private homebuilders

Intensification instead of green field expansion

Local communities often oppose the expansion of urban areas, towns and villages to facilitate more housing.

An alternative approach is to actively look at opportunities to densify and consolidate existing built-up areas.  The conversion of empty properties can help with this.

A good example is Bad Kissingen county council in Bavaria, which is taking action by working with all 26 of its local councils.

It has set up a local land register (it calls this a ‘land exchange’) that identifies potential developable building land and regeneration opportunities. As part of this initiative landowners are regularly approached to encourage them to list their land so that it can potentially be brought forward for development. Sites which come forward through pre-application enquiries and unimplemented planning permissions are also recorded. For further guidance on this approach please refer to our Briefing Note on How the planning system can generate opportunities.

Participating councils proactively engage with local communities to alert them of available land by staging exhibitions and meetings and making online information available. The land register alerts private homebuilders and small builders to where land is available and incentivises infill and regeneration opportunities to come forward. It also helps to market land opportunities and it enables the council to resist undesirable proposals on green field sites.

The initiative has identified the ‘potential’ for 4,000 plots (on 400 ha of developable land) across the wider district.

Bad Kissingen’s approach to rural intensification has identified more than 50 infill opportunities for new housing in the small market town of Schondra. This is in addition to 44 empty homes and some 20 farm buildings that have potential for conversion Bad Kissingen’s approach to rural intensification has identified more than 50 infill opportunities for new housing in the small market town of Schondra. This is in addition to 44 empty homes and some 20 farm buildings that have potential for conversion

As part of the initiative the county council has published planning and housing guidelines for its councils. These encourage the regeneration of central areas in towns and villages rather than settlement expansion or creation of new plots on green field sites.

The guidelines flag a number of enabling tools that councils are encouraged to use to unlock development opportunities, including: -

  • Reviewing local development plans and related guidance to identify and allocate sites with development potential and promote development (this should include ‘calls-for sites’)
  • Buying land to consolidate plots which can then be sold at market value to private homebuilders, where appropriate in collaboration with builders and landowners (in Germany and France councils can also exercise the Right of First Refusal of land which is being sold)
  • Adopting policies that enable specific types of development that may be contrary to the Local Plan to be permitted provided these support the public good or meet a specific need or demand
  • Land pooling and working proactively with landowners to secure serviced plots
  • Council-led urban and village regeneration initiatives that unlock plot development opportunities, including working with private sector partners and housing associations
  • Using powers of ‘prematurity’ in national policy and law to delay proposed development and plan for new development opportunities (in Germany councils can introduce Development Freezes on designated sites)

Bad Kissingen council believes there are real benefits to taking this approach, including: -

  • For Councils - makes better use of existing infrastructure; improves vitality and viability of service centers and retains existing character of settlements; helps create new homes better suited to modern lifestyles; and, preserves recreation and landscape qualities on settlement edges
  • For the local community - protects existing shops and services; limits cost increases on use of infrastructure; removes unsightly undeveloped land and improves amenity; improves social mix and creates opportunities for younger people and families; and, maintains quality of life
  • For investors - builds on established character and qualities of area; makes use of established infrastructure and services; and limits site service costs

These approaches are beginning to be considered in the UK context. For example, Dartmoor National Park Authority is currently identifying suitable development sites as part of its register of sites.

South Cambridgeshire District Council is also currently looking to identify suitable private homebuilding sites as part of a drive to support people who want to build their own homes.

Further guidance on this approach is provided in our Briefing Note on How the planning system can generate opportunities.

TOP TIP 

Work with landowners to assemble sites

Consider joint ventures with landowners and the pooling of land ownerships to unlock opportunities for private homebuilders

Starter Homes for private homebuilders

The Government’s new Starter Homes planning policy (announced 2 March 2015) also provides opportunities for private homebuilding.

Providing starter home opportunities to private homebuilders is not new. In Australia many builders facilitate opportunities for first time homeowners who want to take advantage of the benefits of building your own home.

For example, South Australian builder Fairmont Homes offers a range of affordable ‘house and land packages’ for first homeowners via its ‘Smart Starter’ initiative. This enables eligible private homebuilders that want to build a property for themselves to apply for a HomeStart loan worth up to $15,000 from the South Australia State Government.

The loan is paid in stages to the contractor and the private homebuilder has to have a fixed price contract with a contractor. Eligible social housing tenants who want to buy or build a home can boost their HomeStart loan up to $50,000 by combining it an EquityStart Loan.

Australian ‘house and land packages’ are provided by developers who acquire land (once it is zoned and released for housing), they then service the land, and then either build homes and sell them as a complete house and land deal, or offer a number of standard or customisable home designs.

Our Briefing Note on Other financial support provides more detail on how the financing of house and land packages works in Australia.

Our Briefing Note on How the planning system can generate opportunities explains how private homebuilding is compatible with the Government’s Starter Homes initiative.

Australian builders like Fairmont Homes sell starter house and land packages to first time homebuilders. At Blakeview Grove, north of Adelaide, Fairmont is bringing forward 385 plots with prices from $129,000 (for a 375 sq m plot). A complete house and land package is available for under $300,000 (about £145,000) Australian builders like Fairmont Homes sell starter house and land packages to first time homebuilders. At Blakeview Grove, north of Adelaide, Fairmont is bringing forward 385 plots with prices from $129,000 (for a 375 sq m plot). A complete house and land package is available for under $300,000 (about £145,000)

TOP TIP 

Consider intensification opportunities in towns and villages

Regeneration of central areas in towns and villages can be a real alternative to settlement expansion or the creation of new plots on greenfield sites. Work with landowners to identify suitable opportunities

TOP TIP 

Private homebuilding can deliver Starter Homes

The Government’s new Starter Homes policy provides opportunities for private homebuilding

OTHER OPPORTUNITIES

Exception sites

Councils can already use rural exception sites as a tool to deliver many forms of affordable private homebuilding – from discounted serviced plots and self finish housing to community-led projects. Further guidance is set out in our Briefing Note on Affordable Housing and Exception Sites.

However councils can also introduce local exception site policies in non-rural locations where this will help to deliver local objectives that are in the public interest; and where there is an established demand.

For example, a council could decide to favourably consider planning applications on land that would not otherwise be suitable for housing if the proposal is to bring forward permissioned serviced plots to meet a specific demand identified on a council’s demand Register. This could be applied in any location and could be subject to appropriate local criteria.

Actions like this are also likely to be enabled by the Self-build and Custom Housebuilding Act 2015 and in the emerging legislation contained in the Housing and Planning Bill. This new legislation will impose a duty on councils to have regard to the demand on their local Registers when they carry out their planning, housing, land disposal and regeneration functions, and it will require councils to grant sufficient suitable development permissions on serviced plots of land to meet this demand.

Homes and Community Agency (HCA) disposals 

The HCA has a statutory duty to improve the supply and quality of housing in England. It has an increasingly wide housing remit, including the delivery of the National Affordable Housing Programme, the Get Britain Building programme, administering the Local Infrastructure Fund and working with partners to deliver rural housing.

The HCA also sells surplus public land and has now assumed a central role across Government to ensure developable and viable surplus land and buildings held by central government departments and their agencies is released to support housing and economic growth. More sites are added to the development pipeline all the time and the land portfolio is being boosted further as a result of the 2015 Spending Review and Autumn Statement. This announced that land for more than 160,000 homes will be sold over the next few years.

The HCA’s land portfolio is varied and is spread across the country. It includes former New Town land, coalfield sites, assets inherited from the former Regional Development Agencies and sites previously acquired from other public landowners, including the Ministry of Defence and the Department of Health.

As part of this land disposal remit the HCA is also committed to finding effective ways to bring land forward for new markets and it continues to identify suitable sites in its portfolio for private homebuilding. More than ten sites have so far been brought to the market. This includes a large site at Park Prewett in Basingstoke where up to 120 plots will be made available for private homebuilding as part of the redevelopment of a former hospital site.

The Prewett Park site near Basingstoke will provide up to 120 serviced plots for private homebuilders The Prewett Park site near Basingstoke will provide up to 120 serviced plots for private homebuilders

TOP TIP 

Consider the role of Exception sites

The exception site model can be applied beyond rural areas where this can be justified to deliver local objectives in the public interest and where there is an established demand

Where there is established demand there are opportunities for councils to engage with the HCA to identify suitable private homebuilding sites and help enable these to be brought to market.

Garden Cities

There are also significant opportunities to include a range of private homebuilding opportunities as part of planned new Garden Villages, Suburbs, Towns and Cities.

The Garden City model is an excellent starting point when planning new settlements - both at a town and village level. Garden City principles, which led to the development of experimental towns such as Letchworth and Welwyn, include the need for a masterplan. They also highlight the importance of good quality homes with gardens in an attractive landscape setting.

The diverse nature of private homebuilding and its associated benefits align well with these principles. Opportunities can be identified if custom build developers and enablers are engaged early in the development process to help assess local demand and identify suitable parcels of land that could be brought forward for different types of private homebuilding. This might include shell or package homes and permissioned serviced building plots, which self and custom builders can buy at affordable prices to help get construction underway quickly.

Parcels of land (usually sold at market prices) could also be identified by landowners for group projects, as they have been doing very successfully in continental Europe. Integrating private homebuilding in this way will add diversity and character and help create community cohesion.

However, the Garden City principles also highlight the importance of the community capturing the increase in land value that occurs, so that this can then be reinvested for the benefit of locality. This requires a long term ‘stewardship’ structure that is usually governed by the local community.

This approach aligns well with bringing forward affordable private homebuilding opportunities, particularly when plots or parcels of land for group projects are held by a trust or similar body. This can ensure the homes remain affordable in perpetuity.

Some councils already recognise the role that private homebuilding can play when planning new settlements and urban extensions. For example Cherwell District Council’s new private homebuilding development at Graven Hill forms an important part of the 13,000 Bicester ‘Garden Town’. Smaller scale Garden Suburbs also present opportunities, as recognised by Ipswich Borough Council.

At a larger scale, the planned new ‘Garden City’ at Ebbsfleet will provide up to 15,000 new homes, and should therefore create opportunities for a number of private homebuilding developments. This has also been confirmed by the Housing and Planning Minister.

The Supplementary Planning Document for the new Ipswich Garden Suburb, to build up to 3,500 new homes, recognises the need to include opportunities for private homebuilding in each defined neighbourhood The Supplementary Planning Document for the new Ipswich Garden Suburb, to build up to 3,500 new homes, recognises the need to include opportunities for private homebuilding in each defined neighbourhood

ANNEX 1: STEPS TO LAND POOLING IN GERMANY

The German land pooling process follows a number of broad stages, as set out in the Federal Building Code: -

  1. Decision to commence pooling - the municipality takes a formal decision to start the procedure by determining the area that is to be subject to pooling. This also includes the establishment of a pooling committee. This is a special purpose executive decision-making body that acts on behalf of the council and typically consists of a chair, two councillors, a valuer and a surveyor
  1. Consultation with property owners - the pooling committee begins informal engagement with the affected landowners to establish their willingness to participate, and to explain the process and the expected outcomes
  1. Resolution to designate - the municipality resolves to designate the area and issues a restraining order to landowners. This requires them to seek the written approval of the council when seeking to build on the land or to alter the easements to a plot, and when selling, sub-dividing or changing the property rights of the property (for example taking out mortgages)
  1. Preparation of pooling plan - this consists of a plan of the area and an inventory of all the parcels of land, and involves several steps: -
  • Preparation of an inventory of all properties and the plan that is made available to affected landowners (and is also open to public scrutiny)
  • The site is then planned for development and, alongside this, a B-Plan is prepared that sets out the future use of the land (this is a parallel process)
  • Existing property rights and claims of all landownerships within the area are established and added together. This forms the ‘reallocation mass’
  1. Engagement with individual property owners - the pooling committee engages with the affected landowners to discuss the proposals for the ‘redistribution’ of the site
  1. Preparation of land allocation proposals - land designated for streets, other public space or similar amenities in the B-Plan is appropriated from the pooled area and allocated to the council. Once this land is in the council’s ownership it means the site can be serviced, so the plots or parcels of land can be developed. The remaining land is then returned to the private landowners using a special redistribution process (Verteilungsmaßstab)

The reallocation of the land is conducted on the basis that each owner gets one or more parcels of land according to their entitlement.

The committee takes into account the former ratio of ownership, so that if , for example, a landowner possessed 20 per cent of the overall value of all the original parcels of land he would receive 20 per cent of the value of the reallocated plots. Once the land has been redistributed no property owner should be either worse or better off in comparison to the other parties involved.

Redistribution must be done either by using a value or size criteria and all parties need to agree which is used. The use of the size criteria is only suitable if the values of all former plots are fairly similar.

When using the value criteria the property owner’s entitlements are calculated based on the values of the original land ownership prior to the area being designated for pooling.

Landowners have to pay the difference between the value of their former plot (undeveloped) and the value of their serviced land after the pooling procedure. This enables the municipality to retain betterment value.

If using the size criteria the municipality can apply a ‘plot area levy’ to offset any advantages that might arise from the reallocation. However, by law this may not be more than 30% for greenfield sites and 10 per cent for other land.

Where it is not possible to match entitlements the municipality can vary entitlements and make financial adjustments. For example a landowner who contributed a small parcel of land may not always be allocated a new plot but would, instead, be offered fair compensation for it.

  1. Further engagement with individual property owners - the pooling committee undertakes further negotiations with affected landowners over the proposed reallocation to finalise the redistribution plan
  2.  Adoption of reallocation plan - relevant extracts of the reallocation plan are served on all affected parties by the committee and the plan is made available for inspection to anyone who can demonstrate a legitimate interest in the affected land. A public notice is then issued setting out the date when the plan will come into force. From this point the plot ownerships are deemed to be ‘reallocated’ and there is no right of challenge
  3. Commencement of reallocation plan - the plan is then implemented

Notes: -

  • Federal Building Law requires any changes to a development plan to have been adopted before the pooling plan is adopted. The process can be legally challenged at key stages
  • The above process can be applied to developed and undeveloped land
  • The provision of essential public infrastructure (services) is the responsibility of the council (or a designated third party) but up to 90 per cent of the costs can be recovered from property owners, with payment required on completion of the infrastructure.
  • The process does not exclude the possibility of the council and property owners creating opportunities for development voluntarily and agreeing this legally between them

TOP TIP 

Work with the Homes and Community Agency

Engage with the HCA to identify suitable surplus public sector land sites that could be disposed for private homebuilding

TOP TIP 

Garden Cities offer larger scale opportunities

The diverse nature and benefits of private homebuilding align well with Garden City principles and can help get new development underway quickly

Further Reading

You might find the following external documents useful in understanding how land is brought forward elsewhere: -

  • Bad Kissingen example - “Locate in town center- the center of life: Land use management and urban center development in the district of Bad Kissingen. Guidelines for local authorities” (“Mitten im Ort – mitten im Leben: Flächenmanagement und Ortskernentwicklung im Landkreis Bad Kissingen. Handreichung für Kommunen”) (Bad Kissingen, 2010) - http://www.lkkissingen.rhoen-saale.net/fileServer/LKKG/2000/23715/Handreichung.pdf

The following Case Studies offer useful insight into the issues discussed in this Briefing Note:

 

CREDITS

The NaCSBA Research & Development Programme is funded by the Nationwide Foundation and aims to promote the self-build and custom build sector as an affordable route into housing for a greater number of people in the UK.

For further information, please visit:

www.nacsba.org.uk or www.selfbuildportal.org.uk