Very recently the Court of Appeal overturned the previous High Court decision in favour of various local authorities that the 2014 Government affordable housing policy relating to small schemes and the Vacant Building Credit was unlawful. The Court of Appeal has ruled this was an incorrect decision. They ruled Vacant Building Credit relating to empty buildings should only incur a contribution to affordable housing on any extra floorspace created. In addition the ruling reconfirmed the lawfulness of the Government policy that no contributions should be sought from developments of 10 new dwellings or less towards affordable housing whether in terms of a physical or financial contribution

It is unclear as to whether the Court of Appeal ruling will be challenged in the Supreme Court by various aggrieved local authorities and the original plaintiffs or whether planning authorities will once again amend their affordable housing policy requirements concerning the above development criteria. The industry can take this in several ways. The re-introduction of this policy could very well lead to a significant reduction in affordable housing contributions. Alternatively both initiatives may be seen at the time of considerable development market uncertainty due to Brexit as a considerable support to scheme viability and in terms of encouraging the re-use of vacant buildings for residential use and encouraging smaller developments by SME developers.

For more information contact John Foddy, Managing Director, FoddyConsult