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Some of the key Budget Autumn 2024 announcements affecting the living sector include:

• £5 billion to be invested in housing in 2025-26
• £500 million to be added to the Affordable Homes Programme to “kickstart the biggest increase to social and affordable housebuilding in a generation”
• Launch of a consultation in spring 2025 on the effectiveness of the land remediation relief scheme
• Over £3 billion to be invested in a ‘warm homes plan’ for heat decarbonisation and household energy efficiency over the next 3 years
• £1 billion in 2025-26 to accelerate the remediation of unsafe housing, particularly the removal of unsafe cladding
• Consultation to take place on a new long-term social housing rent settlement of Consumer Price Index +1% guaranteed for five years, to encourage the private sector to deliver social housing
• £46 million of additional funding to recruit 300 junior planning officers, to accelerate large sites that are stuck in the system and to increase local authority capacity
• £47 million to support developers in delivering up to 28,000 homes that are currently held up by nutrient neutrality issues
• £70 million of the Department for Environment Food and Rural Affairs’ (DEFRA) budget will be provided in 2025-26 “to support infrastructure and housing development while boosting nature’s recovery”
• £3 billion to provide guarantees to assist SME and Build to Rent developers in accessing lower-cost loans
• A rise in the stamp duty surcharge on additional properties from 3% to 5%, to be effective from 31 October 2024.

The New Towns Taskforce is exploring opportunities for large developments – particularly proposals that are regionally significant for both housing numbers and economic growth. The unifying principle will be that each of the new settlements will contain at least 10,000 homes. See here for further details.

The government has named the New Towns Taskforce members .

The Radix Big Tent Housing Commission has published its final report, Beyond the Permacrisis – Delivering 1,000 Homes a Day. The report sets out practical steps that will be needed for the government to meet its 1.5 million housing target, and urges the government to treat housing as national infrastructure. The report also suggests an innovative new strategy, including a new housing delivery unit at the heart of government.

On 20 November, Matthew Pennycook appeared at the Housing, Communities and Local Government Select Committee to answer questions on planning for 1.5 million new homes. He also confirmed the government is on track to publish the final version of the NPPF before Christmas. The recording of the session is available here.

In related news, the BBC reported, on 2 December 2024, that local councils have told the government that its plan to build 1.5 million new homes in England over the next five years is “unrealistic” and “impossible to achieve”. The government has said it will respond to the consultation and publish revisions before the end of the year.

In one of the government-backed fund’s first investments, the National Wealth Fund has joined with Barclays UK Corporate Bank and Lloyds Banking Group to announce financial guarantees that will deliver £1 billion of funding to accelerate the retrofit of social housing in the UK.

The Regulator of Social Housing has published its analysis of social landlords’ first year of Tenant Satisfaction Measure results, along with the results of its National Tenant Survey.

The Prime Minister has announced councils will be given £68 million to build thousands of homes on disused brownfield sites.

The Chartered Institute of Housing has responded to the House of Lords Built Environment Committee’s inquiry into grey belt housing development.

The government has published a consultation, open until 15 January 2025, on measures to overhaul Right to Buy.

The New Homes Quality Board is consulting on proposed changes to the New Homes Quality Code. The short consultation closed in early November, but the outcome will be one to watch.

The Ministry of Housing, Communities and Local Government (MHCLG) and the Department for Energy Security and Net Zero (DESNZ) have launched a joint consultation, open until 26 February 2025, on proposed reforms to the Energy Performance of Buildings (EPB) regime.

The government has also published a consultation on regulating insurance fees for freeholders, landlords and managing agents. The consultation runs until 24 February 2025.

DESNZ has published the summary of responses to its August 2022 call for evidence on land rights and consents processes for electricity network infrastructure. A Working Group will now consider improvements to land purchase and wayleave processes.

Matthew Pennycook has given a ministerial statement on Housing Design and Quality. In it, he has said that the Office for Place will be closed and absorbed into MHCLG, and the government will update the National Design Guide and National Model Design Code in spring 2025. Pennycook said that MHCLG will contribute £46 million for local planning authorities to recruit 300 graduate and apprentice planners, and a further £1 million for Public Practice to recruit planners, architects and urban designers.

The government has announced plans to invest £140 million to create 5,000 more construction apprenticeships in England. New Homebuilding Skills Hubs will be set up in areas that need more housing to train people in trades such as bricklayers, roofers, plasterers, scaffolders, electricians and carpenters.

The Construction Leadership Council (CLC) and nima (formerly known as the UK BIM Alliance) have launched an Information Management Initiative, aimed at improving information management practices in the built and natural environment sector. The Initiative aims to enable the digital integration of data and information throughout the lifecycle of a building. This includes improving the application of emerging technologies such as AI, the internet of things and digital twins.

The Department for Transport has published new research on the effect of uncertainties in the delivery, scope and timing of major transport infrastructure on land development, which can cause friction within the land development market.

The government has government has published its response to the Competition and Market’s Authority’s housebuilding study. It has accepted the recommendations to bring forward a new consumer code for housebuilders and a New Homes Ombudsman service, which will empower homeowners to challenge developers for any quality issues. Other recommendations accepted in principle include greater protections for households living under private management arrangements, including improved transparency and the ability to challenge unfair costs at a tribunal.

A new technical standard has been launched to help UK construction achieve net zero carbon buildings. The free-to-access UK Net Zero Carbon Buildings (NZC Buildings) Standard specifies the criteria a building must meet to be verified as net zero. The requirements encompass construction quality and building performance metrics, and cater to all significant building sectors, including new constructions and existing structures.

In a letter to Matthew Pennycook, a cross-party group of 35 MPs and peers and more than a dozen fuel poverty charities and environmental organisations have called on the government to introduce the new Future Homes Standard without delay, and to ensure the upcoming regulations mandate solar panels for all new-build homes.

The RICS is consulting on a proposed update to the industry standard in relation to service charges in commercial leases. Proposals include: property managers to use best endeavours to achieve standards of performance and competency in the proposed update; budgets and service charge year end accounts to be issued within the timescales identified by RICS; and provision that service charges may include enhancement of the fabric, plant or equipment, if that’s been fully communicated to tenants and the expenditure is evidenced, following a cost-benefit analysis of reasonable options and alternatives. If implemented, the changes will impose a reinforced duty to ensure timely sharing of service charge budgets and accounts. The proposed updated guidance won’t retrospectively apply to existing leases.

The Law Commission is consulting on the security of tenure provisions in the Landlord and Tenant Act 1954. The consultation considers the pros and cons of the current contracting-out model and three possible alternatives (mandatory security of tenure, abolition of security of tenure, a contracting-in model), and whether the types of business tenancy which can benefit from security of tenure are the right ones. The consultation is open until 19 February 2025.

The House of Commons Library has published Leasehold Reform in England and Wales: What’s happening and when? A key facet is that a commonhold bill will be introduced in late 2025. The government plans to make commonhold the default tenure for flats. It also intends to reform ground rents, end homeowners on freehold estates paying fees, and strengthen regulation of managing agents. The government will bring forward a white paper on the proposals next year.

The British Property Federation, the Boards of the Association of Real Estate Funds, and the Investment Property Forum, are engaged in discussions to create a new representative body for the UK real estate sector.

Homes England

Homes England has kicked off its search for a new chair, following the news that Peter Freeman will step down next year. It has also announced ex-Stockport Council boss, Eamonn Boylan, as interim CEO from 15 January 2025.

Homes England has invested £50 million in Schroders Capital’s Real Estate Impact Fund. The Fund is a real estate-focused strategy with the dual aims of delivering a positive social and environmental impact, and securing appropriate risk adjusted returns for investors. It has a residential-led approach, and is predominantly focused on addressing the shortage of social and affordable accommodation and the regeneration of town centres.

Homes England and the North East Combined Authority have signed a Strategic Place Partnership to support the region’s housing ambitions.

Homes England has announced a long-term public-private partnership, focused on affordable housing delivery, with Pension Insurance Corporation and Muse. The new joint venture, Habiko, aims to become self-funding over its 12-year lifespan and plans to deliver 3,000 low-carbon, low-energy affordable homes for the rental market, unlocking institutional investment.

The housing minister has written to Homes England telling it to focus the remainder of the Affordable Homes Programme on maximising social housing delivery. The letter reiterates the government’s ambition to deliver 1.5 million new homes in this parliament and sets out expectations for Homes England support.

Homes England and the Ministry for Housing, Communities and Local Government facilitated the meeting of over 375 leaders from domestic and international institutional investors, developers, housebuilders, regeneration specialists, housing associations, and Combined and Local Authorities, with the aim of creating new partnerships that will significantly increase the scale of housebuilding and urban regeneration across England.

Planning

 The government announced, on 9 December, that planning decisions could be fast-tracked in a sweeping overhaul of local planning committees, as part of new measures to tackle the housing crisis. The measures could include local development plan-compliant applications bypassing planning committees altogether, and enhanced decision-making for local planning officers to implement agreed policy. Details of legal and practical implementation remain to be seen. At the date of writing, confirmation of the government’s proposed changes to the NPPF are also awaited. Walker Morris will continue to monitor and report on developments.

MHCLG has launched a policy paper seeking views on the introduction of ‘Brownfield Passports’ designed to facilitate and expedite development on brownfield land.

The Scottish Government has announced that a new Housing Planning Hub (HPH) will be operational in early 2025, tasked with increasing the rate at which homes with planning permission are delivered. The HPH will tackle the reasons for delays, including waits on decisions for major developments, lengthy negotiations of section 75 agreements, funding issues, and policy requirements to address issues such as flooding or biodiversity.

Three recent planning appeals, each involving adjacent sites, have resulted in slightly contrasting decisions:

• In Evans v Bridgend CBC [2024] EWHC 2607 (Admin), an applicant submitted 2 separate applications on 2 separated parts of a site after planning permission had been refused on the whole site. Under section 70 of the Town and Country Planning Act 1990, the local authority refused permission on the basis a similar application had been refused previously. However, the High Court held that the authority was acting irrationally in treating two separate applications as substantially the same as the earlier single application. An application for permission to build 9 houses on part of the site could not be said to be similar to the application to build 16 houses on the whole site.
• That contrasts with the decision (Appeal Ref: APP/C1570/W/24/3339429 Land East of Porters, Watch House Green, Felsted CM6 3EF) that 2 adjacent sites, owned by the same developer, which would use the same access and would have a “close functional relationship” (such that documents relating to the site referred to “Phase 2”) should not be considered separately for the purposes of affordable housing requirements. They should be considered (for those purposes) together – meaning that the requirement for the provision of affordable housing was triggered.
• Planning permission has been granted for the construction of five dwellings at a site located in a Sussex village (Appeal Ref: APP/C3810/W/23/3335883 Land to rear of Karenza, Hook Lane, Aldingbourne, West Sussex PO20 3TB) after it was found that it didn’t form an additional phase of a larger development that triggered a requirement for the provision of affordable housing. Third parties had submitted compelling evidence of the ownership of the two sites and connections between the companies involved. However, when the earlier scheme was first proposed, the houses turned their backs on the appeal site, suggesting that it was not intended to develop the appeal site at that time. The appellant also demonstrated that an option agreement for the site did not emerge until August 2022, with pre application discussions with the council commencing early the following year. These events suggested that the development of the sites had been considered in succession and independently, rather than as a single development. The development did not, therefore, attract a requirement for the provision of affordable housing.

In an appeal relating to Stanwell Farm, Stanwell, the Planning Inspectorate ruled that an enforcement notice that specified one period (2 months) for compliance in the covering letter but a different period (3 months) in the notice itself was a nullity. The Local Authority could not rely on it and its enforcement action was dismissed. The Inspector stated that the test to be applied was whether the recipient has been told with “reasonable certainty” what they had to do to comply with the notice and by when. That had not been the case with this notice. This case will be of interest not only to those involved in planning, but also others advising clients in relation to other statutory notices.

A recent case has confirmed that perception of harm can be weighed as a material planning consideration in the planning balance.

CBRE has published an article on ‘Addressing resource challenges and accessibility through AI in planning’.

A review led by a leading planning barrister, Lord Charles Banner KC’s Independent review of Legal Challenges to Nationally Significant Infrastructure Projects, sets out recommendations for speeding up handling of legal challenges to major infrastructure projects. The government has opened a call for evidence, open until 30 December 2024, seeking views on the review’s findings and recommendations, and to gather additional suggestions for addressing delays arising from judicial reviews against Development Consent Order decisions.

A new report (A review of the encroachment of residential developments on waste management facilities in England) has concluded that concerns raised by consultees including waste management firms and the Environment Agency should be ‘strengthened’ in the planning balance when councils consider applications for residential development that ‘encroaches’ on waste management facilities. The report states that operational considerations arising from proximity of new housing to waste site boundaries can undermine the efficient recycling and processing of waste at the sites.

Bolsover District Council has secured an interim injunction against a developer, prohibiting the building, selling or leasing of properties on a development, as the council claims the developer had not built enough affordable homes. The case has been adjourned, as the developer has appealed a February 2024 decision refusing to vary the s106 agreement to reduce its obligations. Following the appeal, the matter will be returned to the High Court for a decision on whether the injunction should be continued.

In a recent planning appeal, the inspector has rejected the developer’s assumption on alternative use value in assessing whether the development was able to support affordable housing.

New research by the Home Builders Federation estimates that local authorities in England and Wales are sitting on over £8 billion of infrastructure payments made by developers, including over £6 billion from section 106 agreements and almost £2 billion raised through the Community Infrastructure Levy.

BNG/nature/climate impact

The UK government has commissioned a DEFRA regulatory review to examine how the current regulatory framework affects economic growth while ensuring the natural environment is not compromised. This development has sparked widespread interest within the construction industry, particularly for its potential impact in relation to nutrient neutrality and biodiversity net gain (BNG).

ENDS and PlanningResource are apparently seeking confirmation of reports that the government is considering broadening the range of developments that are required to comply with BNG, under plans to resolve ‘loopholes’ in the policy. One to watch.

Environment Bank has recently announced that it is working in collaboration with Barclays to support greater visibility and adoption of BNG among housebuilders and England-based farmers.

In Vistry Homes Ltd and Fairfax Acquisitions Ltd [2024] EWHC 2088, the High Court considered how weight should be attributed to material considerations such as economic benefit, BNG and the status of land as PDL in the Green Belt.

In Weston Homes Plc, R (On the Application Of) v Secretary of State for Levelling Up, Housing and Communities & Anor [2024] EWHC 2089 (Admin), Weston Homes challenged a refusal planning permission for 96 dwellings. One of the successful grounds of challenge was on BNG. The development was submitted before mandatory BNG was introduced, but the development would achieve BNG of more than 10%. The court considered that, when refusing permission, the Planning Inspector had given insufficient weight, in the planning balance, to the development’s overall BNG.

£47 million will be provided to support seven councils in delivering nutrient neutrality mitigation. The government has confirmed its intention to bring forward changes designed to unlock nutrient neutrality stalled homes. The Local Nutrient Mitigation Fund will be used to protect local rivers and precious habitats, boosting housebuilding through locally led schemes, such as creating new wetlands, upgrading septic tanks, and implementing pollution solutions.

Wildlife and Countryside Link has published an assessment of how the UK government is delivering on its pledges under the Global Biodiversity Framework. In short, the conclusion is ‘nowhere close’. Out of 26 rankings, England is judged to be ‘in the red’ on more than half, with policies currently expected to be ‘inadequate’ to meet targets in all areas.

The Scottish Government has published its Natural capital: Market Framework, which outlines the steps the Scottish public sector will take to: attract greater responsible private investment into high-integrity natural capital markets; ensure that private investment in natural capital benefits local communities, supports Scotland’s environmental objectives, and follows Scotland’s principles of responsible, values-led investment in natural capital; and enable Scotland’s land owners and managers to provide nature-based benefits via high-integrity natural capital markets.

Natural England has launched its first Local Nature Recovery Strategy. It’s the first of 48 that will cover England and involves local authorities, government agencies and NGOs working together and with communities to identify where efforts should be focused to restore nature.

ENDS (16 September 2024) has reported that an unpublished paper from the Environment Agency has found that the cost of remediating high-risk ‘forever chemicals’ sites in England could range from £31 billion to £121 billion. The issue is likely to be ‘one to watch’ as a key question for landowners, investors and developers will be “who pays?”. Some insurers are reportedly refusing cover for PFAS contamination.

The Department for Energy Security and Net Zero has now announced a pilot scheme for England’s first heat network zones. Six towns and cities, including Leeds, Plymouth, Bristol, Stockport, Sheffield, and two in London, have been selected to develop the country’s first heat network zones and will receive a share of £5.8 million in government funding, with construction expected to commence in 2026. See Walker Morris article on heat network zones and what businesses need to know.

The RICS has published materials, including a webinar, on the subject of ESG in real estate. Experts from the webinar highlighted the following key points: the industry still has a long way to go in achieving resilience against ESG risks, which are becoming critical for property value and marketability; ESG standards need incorporating into everyday operations; technology is vital to assess, manage, and report ESG risks in real estate.

Building Safety

The Health and Safety Executive has published FAQs on how the Building Control Authority works, and what the Building Safety Regulator expects from industry.

The government has announced its Remediation Acceleration Plan, which aims to speed up the removal of unsafe cladding. Under the Plan, buildings higher than 18 metres with dangerous cladding covered by government-funded schemes will be fixed; and unsafe cladding in buildings over 11 metres should either be fixed or have a date for completion, or landlords will face penalties.

Statutory guidance for building regulation in England has been recently updated and published. It covers fire safety matters within and around buildings. Updates to Approved Document B include provisions for sprinklers in all new care homes, irrespective of height.

On 18 October 2024, the government published a joint statement on whether a roof garden is classified as a storey when determining whether a building is a Higher-Risk Building. The question arose after the First-tier Tribunal in  Smoke House & Curing House highlighted apparent contradictions between government guidance and statutory provisions. The government has now made clear that it considers that an open rooftop, such as a rooftop garden, is not counted towards the number of storeys. It has also stated: “The Ministry of Housing, Communities and Local Government and the Building Safety Regulator are currently considering the views expressed by the Tribunal… that roof gardens should be classified as a storey… Until stated otherwise, the sector and regulatory bodies should continue to refer to existing government guidance.“

Retirement/care living

Do you operate in the retirement/care living sector? If so, this industry outlook may be of interest

Colliers has published its Healthcare Market Snapshot for Q3 2024.

The government has published the final report of the Older People’s Housing Taskforce, Our Future Homes: Housing that promotes wellbeing and community for an ageing population. The report suggests 1 in 10 homes delivered by Homes England should be for older people, to combat the unaffordability of retirement housing.

Home care technology specialist Birdie has released the white paper, Ready to Care: The First Steps to Fixing Social Care, including recommendations and contributions from providers, local authorities, NHS trusts and policy organisations.

Age UK has launched its new five-year strategy with its report, Why we want to change how we age (ageuk.org.uk). Ambitions around transforming public attitudes to ageing and older people, supporting older people to get the health and care they need, and tackling poverty and inequalities, are central to the strategy.

Dr Penny Dash’s final report into the operational effectiveness of the Care Quality Commission has been published. It has identified internal failings, loss of credibility, and an urgent need for a rapid turnaround, and includes recommendations to address poor performance. A second review considering the wider landscape for quality of care, with an initial focus on safety, will be published in early 2025.

New guidance sets out expectations for the  Responsible Use of AI and Particularly Generative AI in Adult Social Care. These include that employers will: set out clearly if, when and how AI can or should be used by staff; provide AI tech training and access to continued learning; take full responsibility for any harm that may be caused using AI if procedures and policies are followed correctly; provide work devices and reimbursement for any data or software costs that may be incurred using AI services. The guidance also makes recommendations for policymakers and regulators, including that AI awareness should form part of the Care Certificate.

The newly formed House of Commons Health and Social Care Committee has launched an inquiry into the cost of inaction in adult social care by successive governments.

Bupa has launched a new report designed to support the healthcare sector to reduce its environmental impact.

Did you see…?

We have published the first edition of our new publication, Legal Horizon. The scanner is designed to keep in-house counsel and board members up to speed with the legal issues impacting businesses today and to come. It provides bitesize highlights, so that you can quickly and easily digest the developments that really matter.