The Government has published a new National Planning Policy Framework (NPPF) for England, introducing stronger support for development around transport hubs and attempting to make planning decisions faster and more consistent.
The framework establishes an in-principle “default yes” for suitable housing and mixed-use schemes within reasonable walking distance of well-connected train and tram stations.
Minimum densities of 35 homes per hectare will apply around qualifying stations with at least four services an hour, rising to 45 homes per hectare where there are eight or more. The Government expects higher densities where local conditions allow.
However, United Trust Bank (UTB) warns that easier access to planning permission will not necessarily translate into development starts unless housebuilders have confidence in demand, sales values and their eventual exits.
PLANNING RULES REWRITTEN
The new NPPF, published on 17 August, replaces the December 2024 framework and forms part of the Government’s drive to deliver 1.5 million homes during the current Parliament.
Alongside station-led development, the reforms introduce clearer national policies for determining applications, stronger support for sustainable development and measures intended to reduce duplication between national and local requirements.
The Government is also streamlining the role of statutory consultees, with the aim of reducing unnecessary referrals and delays while retaining specialist scrutiny where it is required.
Despite the changes, the final station-density policy is less prescriptive than the version consulted on. Ministers originally proposed minimum densities of 40 homes per hectare around all stations and 50 around those considered well connected.
The requirement has now been removed for stations with lower service frequencies and replaced with the tiered 35 and 45-home thresholds.
PERMISSIONS DO NOT GUARANTEE STARTS
Official figures demonstrate the challenge of converting planning policy into construction activity.
Around 235,000 homes received planning permission in England during the year to March 2025. In the year to March 2026, new-build completions stood at 143,110, down 6% annually, while starts increased by 15% to 130,170.
The figures cover different groups of schemes and therefore do not represent a direct conversion rate. However, they illustrate the gap between the number of homes passing through the planning system and those reaching completion.
Planning activity has also weakened, with councils granting 28,100 residential applications in the year to March 2026, down 4%.
DEMAND DETERMINES VIABILITY
Adam Bovingdon (main picture), managing director of real estate finance at United Trust Bank, says: “There was a hope that the delayed NPPF would be accompanied by demand side stimulus, as planning remains just one part of the current housebuilding crisis.
“Greater consistency in planning decisions, support for development around transport infrastructure and measures which help scheme viability should all assist housing delivery and create opportunities for housebuilders and developers.
“Developers need confidence.”
He adds: “The real risk though is that improvements in the planning environment simply result in more consented land rather than more homes being built. Developers need confidence that completed homes can be sold at a rate and value that justifies committing capital and taking construction risk. Without that confidence, planning permissions may be secured but development starts delayed, with sites held back until market conditions improve.
“Across many parts of the country there are already significant numbers of completed and partly completed new homes available for sale, yet buyer demand remains subdued. The industry cannot continue to increase housing delivery if purchasers are unable or unwilling to buy.”
NEW HELP TO BUY SCHEME
And he says: “Government action is therefore needed on the demand side as well as the supply side. A modernised Help to Buy style scheme targeted at first time buyers and focused on SME housebuilders and developers, together with a review of stamp duty, would help improve affordability, increase transaction volumes and give developers the confidence to build more homes speculatively.
“The industry has shown it can deliver homes when there is demand. Planning reform is essential, but unless it is accompanied by measures that stimulate buyer demand, there is a risk that housing delivery will continue to fall short of Government ambitions.”
