How Neighbourhood Planning can encourage private homebuilding

KEY LEARNING POINTS

  • Communities are using Neighbourhood Plans and Development Orders in a range of ways to support private homebuilding projects
  • Promote the use of neighbourhood planning to communities and work with and encourage communities to use this approach to create opportunities for private homebuilding

INTRODUCTION

Neighbourhood planning is becoming increasingly popular. It gives communities direct power to develop a shared vision for their neighbourhood so they can deliver the development they need and want. Parishes and ‘neighbourhood forums’ can use neighbourhood plans to set planning policies to inform council decisions on planning applications in their area. They can also use neighbourhood planning to grant planning permission through Neighbourhood Development Orders; and they can employ Community Right to Build Orders to promote specific projects. 

Communities therefore have a series of powerful planning tools to support private homebuilding, even in areas where councils don’t have any policies in place to encourage this type of housing.

To date more than 1,650 neighbourhood planning areas have been designated across England, and over 80 communities have now ‘made’ a Plan or Order.

This Briefing Note provides more detail on the advantages and scope of these tools, and how they are and can be applied to support private homebuilding.

Advantages for local communities

There are a number of reasons why local communities should consider using neighbourhood planning to support private homebuilding projects: -

  • It enables communities to decide for themselves where and what type of housing should be built locally
  • It supports much-needed local housing, and can secure affordable homes for local people for future generations in perpetuity
  • It helps local people to access home ownership and live in homes designed to meet their needs
  • It promotes more diverse, better designed, more sustainable and greener housing that can be better value compared to volume developer-built equivalents
  • It supports community cohesion because it enables people to stay in their local areas and get to know their neighbours during the building process, particularly for group projects. This can lead to lasting mutual involvement in the governance and care of the neighbourhood
  • It supports builders, suppliers and tradespeople in the local construction industry, which helps the local economy. Every project sustains seven construction jobs for a year and can support local product or service suppliers
  • It enables local people to acquire new skills. These skills can help them secure future employment, or can equip them to support further community driven housing projects.

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.

NEIGHBOURHOOD PLANS

Communities can prepare a Neighbourhood Plan to help shape, manage and direct sustainable new housing in their local area. The Neighbourhood Plan can support private homebuilding, even where the council’s Local Plan does not include any policies. When brought into force, a Neighbourhood Plan becomes part of the development plan for the neighbourhood area. They can be prepared before or at the same time as the council is producing its Local Plan.

Neighbourhood Plan policies could take a range of approaches to support private homebuilding, such as: -

  • Encouraging private homebuilding in the area or asking new housing developments to include serviced building plots in a scheme
  • Identifying specific sites and areas where private homebuilding should be directed. This would give confidence and encourage local people and landowners to initiate projects
  • Promoting affordable private homebuilding projects on rural exception sites - either as single homes or as part of a larger site. This could be subject to meeting criteria such as a local connection test, and the homes being subject to below market value resale restrictions in perpetuity
  • Asking for a percentage of affordable housing on a site to be delivered as affordable privately built homes via serviced plots, either individually or as a group project
  • Encouraging and identifying suitable sites where group projects can be built
  • Promoting specific projects.

Examples of approaches used by communities

The Brereton Neighbourhood Plan encourages private homebuilding by local people on appropriate sites in the area. To help deliver this it allows these homes to be built on rural exception sites. However, to be acceptable, proposals need to be sympathetic to the character of the open countryside, have minimal visual and environmental impact and conform with the plan’s quality standards.

Brereton’s Plan supports some private homebuilding on rural exception sites

Only those acting on behalf of individuals or a community group can build the homes, and no single person or group will be given planning permission for more than one home in any one scheme. This means for example, a single planning permission for ten homes would need to be developed for occupation by ten distinct households.

A unilateral undertaking will also be required to confirm: -

  • A connection with the parish
  • The intention to construct the home within two years of purchase
  • The intention to live in the property once it is built.

The Drayton Neighbourhood Plan includes two community policies. The first says that all efforts will be made to identify demand for private homebuilding within the parish. Where sufficient demand is established, measures are to be taken to identify appropriate sites for self-build in the parish. The policy also directs interested parishioners to appropriate resources and information. The second policy takes a similar approach to promote co-housing.

The Frome Neighbourhood Plan flags strong support for self-build and community-led development and a wish to see more sites made available for this form of housing. It therefore asks any development of more than 100 houses to provide at least five serviced plots for private homebuilders.

The Frome Neighbourhood Plan encourages community-led housing projects

It also allows self-build and community-led housing to be built adjoining the town of Frome on exception sites providing the proposal meets a number of criteria, including the need for: -

  • The development to provide collective land ownership and shared management responsibility
  • An appropriate mix of homes to meet local demand. The development would have to be energy efficient and not have a significant adverse impact on the character of the area and local landscape setting
  • Prospective residents to demonstrate that they have the professional and financial capacity and competency to undertake the development
  • The land to be held in trust as a community asset in perpetuity with values of homes or rents restricted to no more than 80 per cent of market value

The Lynton and Lynmouth Neighbourhood Plan (The Lyn Plan) recognises that the private homebuilding process can offer considerable cost savings, so it is a way individuals can directly provide affordable housing. The plan therefore supports it through its affordable housing policy.

The Petersfield Neighbourhood Plan also recognises that private homebuilding can be a way of providing affordable housing for local people. The town council therefore encourages self-build and custom build housing in its plan and has allocated two sites for about 120 homes exclusively for private homebuilders. 

The plan supports proposals for new homes submitted by individuals, by a builder or a developer acting on behalf of an individual, or by a community group such as a Community Land Trust. To be acceptable the proposal will need to conform with the site design brief in the Plan and meet the requirements in the East Hampshire District Local Plan. 

Landowners or developers who have an interest in these sites are encouraged to provide roads and services to the individual plots. They will also need to facilitate the same amount of affordable housing as for any other site, although they can do so using alternative mechanisms - such as via a Community Land Trust.

Planning permission for individual privately built homes on identified sites will only be granted where applicants enter into a planning agreement that: -

  • Restricts the occupancy to people with a local connection in perpetuity
  • Requires people to live in the property once it is complete
  • Completes construction of the home within two years 

The Woodcote Neighbourhood plan recognises that a small infill site could provide an opportunity for a small number of privately built homes. To be acceptable the development would need to comply with the Plan’s infill housing policy. The Plan also accepts Community Land Trusts under its affordable housing policy for allocated sites. The parish council will also be consulting with interested affordable housing providers about the feasibility of establishing a Woodcote Community Land Trust.

Woodcote has identified an opportunity for private homebuilding on small infill sites

The Winslow Neighbourhood Plan allocates land for 455 homes over the plan period, including a one hectare site of open market housing to provide around 20 custom-build homes. To deliver this the Plan says the town council will consider setting up a Community Land Trust. The CLT could take responsibility for identifying self-builders for a community-scale project, and for procuring the necessary site servicing. Alternatively the town council may decide to work with an appropriate development partner.

Top Tip

Use Neighbourhood Plans to support private homebuilding

There are many ways Neighbourhood Plans can be used to help facilitate private homebuilding. Some communities are employing Plans to identify hundreds of opportunities for affordable private homebuilding plots or other community-led housing initiatives for local people

DEVELOPMENT ORDERS

Communities can use Neighbourhood Development Orders and Community Right to Build Orders to grant planning permission for developments that meet the scope of such Orders. 

Neighbourhood Development Orders (NDOs) 

NDOs can be made for a specific site, sites, or apply to a wider area - with or without planning conditions.

Local communities can employ NDOs to give planning permission for private homebuilding projects in a range of locations. Orders can specify what type of development will be acceptable and communities can work with local landowners, developers and custom build enablers to prepare Orders to bring forward specific projects for local people. 

Benefits of NDOs include: -

  • They enable communities to shape and better manage the type of development that is acceptable in the area, particularly if linked to a Design Code (see our Briefing Note on Design Codes and Plot Passports)
  • Speedier building - once adopted they remove the need for anyone to apply to the council for planning permission if it is for the type of development covered by the Order
  • Less bureaucracy and cost when applying for planning permission
  • Greater certainty - they provide more clarity about what form of development will be supported; this can also helps with securing finance for projects

Community Right to Build Orders

This Right empowers local people to propose a development in their area and secure permission for it by making a Community Right to Build Order.

The Orders do not need go through the usual planning process or be part of a Neighbourhood Plan. They also have specific support in national planning policy. They can be used to approve the building of homes (new-build or conversion of existing buildings), shops, businesses, affordable housing, community facilities or playgrounds. It is up to the community to decide the type, quantity and design of properties for the development. 

Given their scope these Orders are an important tool available for local communities to support affordable private homebuilding projects. These can range from creating serviced building plots on the edge of a village, working with a builder or custom build enabler to deliver self-finish homes on a rural housing site or facilitating a group of local people to work together to build homes for their families. Key advantages are that these Orders can ensure that the housing remains affordable in perpetuity, and any revenue directly generated through the Order is retained by the community.

There is a defined procedure for taking forward a Community Right to Build Order which can be summarised in the following broad steps: -

  • A group of local people form a legally constituted community organisation
  • They define the area where the Order will apply
  • They engage with the wider community to gauge support for the development they want to approve through the Order
  • They prepare detailed proposals for their project and draw up a draft Order
  • They submit the draft Order to the local council, who will arrange for it to be examined by an independent examiner
  • The council organises a referendum of voters in the defined area, to see if voters support the Order
  • The Order is ‘made’ if more than 50 per cent of voters in the referendum support the Order - this means planning permission is granted and the development can go ahead

One example of an emerging Community Right to Build Order that supports private homebuilding is the Slaugham Parish Neighbourhood Plan (SPNP).

The site identified in the Community Right to Build Order at Slaugham could accommodate a number of self build homes on serviced plots

The SPNP includes two Community Right to Build Orders. One of these - Community Right to Build Order No. 1 (St. Martin Close & Coos Lane, Handcross) - will give planning permission for several self build homes on serviced plots with an outline design controlled by a design code. The delivery vehicle for this will be a Community Land Trust.

More than eight million people live in areas where neighbourhood plans are now being progressed
 

SUPPORT FOR NEIGHBOURHOOD PLANNING

National planning policy asks councils to take a proactive and positive approach where communities want to take forward neighbourhood planning and to help them identify and resolve any issues before draft Plans and Development Orders are submitted for independent examination.

To help councils deliver neighbourhood and local plans the Government is making £600,000 of grant funding available for the 2015/16 financial. This is open to councils who want to: - 

  • Better support neighbourhood planning by piloting ways of making neighbourhood planning an integral part of their planning service, for example in relation to Local Plan-making, or
  • Identify ways of involving or delegating planning decisions to neighbourhood planning groups, or
  • Make changes to their service to ensure that they have an up-to-date Local Plan in place by 2017.

Local landowners, house builders and custom build developers can also play a key role in helping to facilitate the type of development communities want in their area.

Communities can apply for grant funding under the Government’s £22.5m Neighbourhood Planning programme, or the £3.5m Community Buildings programme to help them progress their projects and secure professional help where needed.

Take up of support through these new programmes has been high.

More than 350 applications to the Neighbourhood Planning programme have so far been submitted, and grants of £1.5m and £220,000 of technical support has already been handed out. There have also been more than 100 applications for Community Buildings project and pre-feasibility grants, with in excess of £300,000 awarded so far. See our Briefing Note on Government loans and grants.

Top Tip

Raise community awareness of neighbourhood planning

Engage proactively with communities and support them if they wish to use neighbourhood planning to deliver opportunities for private homebuilding projects

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