Legal viewpoint: Clarity awaited on grass roots plans

St Ives, the coastal artist's favourite, has hit the news after the town council put forward radical plans to restrict new homes to occupation only as main residences and require 50 per cent to be affordable.

Many local people find house prices in the Cornish resort unaffordable, yet tourists and second home owners do bring in essential business all year round.

These measures are part of St Ives Town Council’s draft neighbourhood development plan (NDP), which will go to consultation and examination before being put forward for a local referendum. If the NDP is approved by 50 per cent of those voting, the occupancy restriction could be imposed through section 106 obligations or planning conditions. Whether developers would choose to build new homes on any significant scale with that restriction in place would be another issue. Margins could become severely squeezed.

The occupancy restriction would not of itself ensure affordability. This point has been made in several appeals relating to holiday homes in Cumbria, where similar obligations have sometimes been lifted on appeal. Perhaps some flexibility should be built into the policy to restrict the prohibition to a certain percentage of new units, depending on viability, income and market value. Also, because the restriction would not apply to existing properties, it could result in even higher prices if it has the effect of halting development in the area.

Of the 1,000 communities that have taken initial steps towards preparing an NDP, around 40 have now had a referendum result. So far, only one of these NDPs has failed at examination, although modifications to others have been recommended.

Developers are keeping a close watch on progress in this area and a few High Court challenges are pending, following refusals of permission based on conflict with a draft or confirmed NDP. While overall caps on housing numbers have not been allowed in NDPs, restrictions such as settlement boundaries are being imposed.

Last month, the secretary of state refused permission for 211 homes at Winslow, Buckinghamshire after giving very substantial weight to a conflict with an approved NDP (DCS Number 200-002-972). He found no material considerations to justify a departure from the development plan, even though it was acknowledged that the NDP housing policies were out of date due to the lack of a five-year land supply.

Until the High Court rulings force some clarity on the outstanding challenges, it could be very difficult for developers to secure permission where proposals conflict even with a draft NDP. Working with neighbourhood forums to secure site allocations seems to offer the only certainty, but inevitably far more restricted numbers of units will be allowed this way. How this will play out when local plans are put in place with higher housing numbers remains to be seen.

Alex Ground is an associate solicitor, commercial property group at Russell-Cooke solicitors

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