Written evidence submitted by Hills Homes Developments Ltd [FPS 084]
Part of the Hills Group, Hills Homes has established a strong reputation for building high quality homes on carefully selected sites within Swindon and the neighbouring counties. From bespoke country homes on the edge of sought after villages to major urban developments, Hills bring individual quality to each of their developments.
As the Land Manager of an SME housing Construction Company, the speedy turnaround of planning applications is integral to its survival and profitability to continue to employ individuals, and reinvest in them as well as other land opportunities for future projects. Currently the availability of land that is both suitable and at a cost that makes it viable for SME housing projects is scarce, and often land that is left over (scraps from the table) comes at an inflated cost or indeed engineering and construction constraints that require significant financial outlay that when completed rarely brings the kind of profit to enable us to grow or reinvest as we otherwise would.
Unlike other SME’s we are slightly in a more beneficial position that as part of a Group that has interests in aggregates, and waste we are able to remediate land that we own from these activities. These still however come at significant cost compared traditional Greenfield or indeed Brownfield sites that you would find on the market, the benefit being that we face no competition in bidding or facing an inflated land sale cost. I will try and answer with our own recent experiences as evidence the following issues The Committee has invited responses on this is not an exhaustive list but hopefully gives an idea of the issues we face:
Clearly due to the fact these questions are being asked the planning system in its current form is not working, the government has looked into the countries housing needs, and released housing delivery figures they believe are necessary and reasonable to meet the countries pressing housing need. These figures have consistently not been met, and have allowed PLC housing companies to dramatically increase profits yet has seen a huge reduction in the number of SME companies contributing to the housing supply. The impact of planning is so significant to small enterprises that established PLC chairman have noted that if they were to start their businesses again from scratch they would be unable to do so, because of the length of time that planning now takes as well as the costs involved.
Recently as a company we purchased a site that benefitted from an Outline planning permission won at appeal for 15 houses, to take this site through reserved matters took over 18 months and nearly £100k in costs (as well as being called into committee twice even though an existing outline permission for 15 houses had already been granted at appeal), it is little wonder that housing prices are at the level they are and still rising. The length of time for determination of even reserved matters is so significant that we found ourselves dealing with numerous different local authority consultants, and planning officers (as individuals either changed job’s, left the LA or in one case died of old age) all of whom had a different view on matters. It is very clear on what the role of a planning officer is yet so rarely do they carry out their duties in making a decision or arbitrating between two conflicting consultee’s, an impasse is reached then the request is normally upon us the housebuilder to make “small” amendments to a submission. It is clear that planning officers do not understand the commercial impact these “small” amendments mean, and often they cause significant change elsewhere, for example in asking for a house to be moved, or a tree to be planted elsewhere invariably means that drainage, highways, landscaping plans and drawings etc. etc. also need to be changed, and then consulted upon again, all of which needs to be paid for. The stark reality of this is that until a company see’s any form of profit they have to forecast and factor in so many unknowns regarding time and cost, that making a viable assessment on land is nigh on impossible and full of risk.
The greatest obstacle is obtaining planning itself, if permissions were granted in a speedier manner with surety of the costs involved, the process of building the subsequent houses is relatively straightforward. The length of time to reach a decision is so significant and with rising costs that the only way that housebuilders can make a profit is too inevitably put those costs on the units themselves. It is little wonder that those trying to get on the housing market struggle when there is so little out there in the way of choice. It is simple supply and demand economics if reasonably priced housing is scarce or with limited choice you are beholden to the price of vendor, if there are more houses there is more competition therefore the opportunity to look elsewhere means companies will have to reduce their prices.
There exists all manner of design guides that local authorities ask developers to refer to when considering a development, already within planning applications there is a need to provide designs on building elevations as well examples of the materials that are to be used. The only issue is the consistency that goes with making the decisions, if one company can reasonably provide alternative examples or show that what is being requested is unreasonable and unnecessary then that should be the same for other applications in the same area.
The current system in determining the numbers of houses to be delivered seems to be suitable in its current format, however more emphasis needs to made on those housing companies that bank land with a permission, to build the units in as reasonable time as possible once the granting of a permission is reached.
If anything public engagement is already too high, the introduction of neighbourhood plans more often than not has muddied the water. As is often the case when people are asked to contribute their thoughts on a matter all of a sudden it becomes design by committee, where everybody becomes a subject matter expert. Very rarely do neighbourhood plans allocate enough area for new development. Infrastructure in urban areas that inevitably have to take the shortfall of housing cannot cope with what is then subsequently delivered. Unfortunately as there seems to be no appetite to provide areas of Green belt land for new development with fit for purpose services then existing drainage and highways the have to be consistently retrofitted at great cost and disruption. Unfortunately those villages on the edges of existing towns eventually get swallowed up and incorporated; this is an inevitability of expansion. A brilliant example of City growth is the city of Plymouth it needed to expand until eventually it incorporated what were individual towns and hamlets as part of the city limits over a very short period of time. Villages very often like the benefits that development bring by way of the contributions made, but don’t want the developments themselves, it is little wonder that village shops, and public houses are closing at a significant rate when there is no one to use them.
The planning system already caters for the above, there are a significant number of AONB’s, conservation areas and listed buildings that are designated no go areas for development. The consideration should be what justifies and constitutes these areas, arbitrarily saying that “you cannot build here as its adjacent or insight of a conservation area” needs sound reasoning why this is the case, and planning officials must be consistent in their decisions, allowing change and development in one instance and refusing in another is not acceptable.
Currently the clarity on what constitutes greenbelt changes from authority to authority. To allow much needed construction and development to proceed there needs to be an acceptance that areas of greenbelt will need to be made available for expansion. Areas with established woodland should remain as such, as should those areas that serve a purpose for public open space as a community asset. However agricultural land that has continually been used, needs to be accepted that it has an intrinsic value for the development of new properties, again the more of this made available would see a reduction in land prices, a reduction in house prices yet a dramatic increase in both productivity and employment.
In the 10 plus years I have worked within construction I have seen nothing that suggests SME’s are getting the support necessary to operate as viable businesses, in fact if anything it is notable the number that have ceased operating. There are two major issues that need addressing 1) What constitutes an SME and what can be done to streamline the process and make it possible for SME’s to both operate and positively contribute to the governments housing need. 2) Should SME’s even be held to the same planning conditions and contributions that Plc’s are?
SME’s operate to the same standards and constraints that Plc’s do except they rarely have the finances or resource’s needed to do it successfully. In a recent Local Authority planning meeting with a number of other housebuilders in was in general agreement to hold SME’s to the same standards as Plc’s was counterproductive and unfair. The comparison being that we are trying to operate in the Premier League with second division money whilst you can do this for a period it is not sustainable.
With much media fanfare the bonuses that Plc housing companies are able to award themselves beggar’s belief; these same companies have successfully managed to argue against necessary local contributions on the grounds of viability. I am not suggesting that planning permissions should be arbitrarily granted to smaller companies on whim, however if houses are being built in line with building standards and providing the correct supporting infrastructure as well as the necessary contributions with CIL and affordable housing, and a decision is not reached on an application within a certain period of time then that application should be agreed in principle, or if refused the reason for refusal should be commensurate to the scale and size of the application submitted.
This by no means is a full and exhaustive list of the current issues that the planning system faces and needs to rectify, and there are a number of things that the planning system has within and requires that are useful, but it is a bite sized piece to be digested and considered. If the opportunity arose that allowed a more thorough example of the failings that myself and my company have had over recent years it would be very easy with more time to present these.