
The ARL responds to the Government’s National Planning Policy Framework consultation
The ARL extends its thanks to all members who contributed to our formal response to the Government’s consultation on proposals for a revised National Planning Policy Framework (NPPF). With the NPPF consultation closing on 24th September 2024, we have been able to deliver a timely, focused response on behalf of the entire rental living sector, including Build to Rent (BTR).
A key example of our work on behalf of members, our submission highlighted several crucial points.
Firstly, we strongly called for targets for purpose-built rental homes within local authority local plans as part of a mixed-tenure approach that delivers homes for all. Rental housing in the form of professionally managed Build to Rent (BTR) is an increasingly popular housing choice and critical to supporting economic growth, enabling people to move as they wish to take up opportunities in growing economies with certainty as to the quality of their rental homes.
We called for all local plans to be mandated to include specific policies on BTR housing, including affordable housing within the sector. There is currently an inconsistent approach, with many Local Planning Authorities having no BTR-specific policies. This is creating uncertainty. Our further recommendation was that, where no Build to Rent policy/policies are included, plans should be found unsound at examination.
Our submission also pointed out that effective cooperation is critical to the delivery of sufficient homes and infrastructure, as well as supporting economic growth in towns and cities. Urban areas often experience very high housing pressures and can benefit from additional housing delivery in adjacent areas, with Build to Rent homes capable of relieving that pressure.
As ARL members are aware, housing is a key sector in need of investment and growth in the UK. Savills projects that the UK needs £300 billion worth of institutional investment to meet the needs of future household growth across the private rented sector (PRS). The BTR sector has a crucial role to play in that future. With £35 billion already invested in it to date, the sector is ready and willing to be part of the UK’s much-needed growth.
To date, the UK has delivered 115,000 completed BTR homes, while an additional further 146,100 are in the planning and delivery pipeline. Given the share of the population living in rental homes, and the rental sector’s role in growth areas, we shone a spotlight on rental affordability as part of the NPPF consultation response. We highlighted the fact that rental affordability is an important signal of housing market pressures and should be an indicator that an uplift in housing delivery is required. We suggested that rental affordability be considered based on a similar ratio to sale prices (i.e. rents to earnings). We also recommended weighting within the calculation based on the share of rental vs home ownership within the area.
Our consultation response also tackled the issue of social rent targets. The BTR model of including affordable housing as Discount Market Rent (also known as Affordable Private Rent) tenure, as supported by the current NPPF, has proven highly successful. The integrated, tenure-blind approach ensures all renters receive the same quality management and maintenance services, resulting in a HomeViews independent resident satisfaction score of 4.36 out of 5 across the whole UK. Were this to change – for example by social rent homes being owned and operated by a Registered Provider – the BTR sector’s efficiencies of scale would be lost, while different service levels between tenants could come into play. As such, we strongly suggested that the NPPF specify that targets for social rent within BTR schemes can be met through Discount Market Rent provision.
Our final point was that the guidance should be clear that Build to Rent be specifically recognised within guides and codes – and that appropriate codes account for this unique residential typology. We are keen that BTR’s contribution to housing delivery be maximised. A key step towards this will be ensuring that assessments of the needs of those who rent their homes differentiate between higher quality, professionally managed BTR homes and the typically lower quality of the wider private rented sector. A lack of clear assessment of needs for purpose-built rental housing results in a lack of policies and therefore reduced delivery. This fails to capitalise on the BTR sector’s enormous potential.
With the Government now in receipt of our response to the NPPF consultation, the ARL will continue to engage in dialogue on this and other policy matters, elevating the voice of members to represent the rental living sector as a whole.