'Landbanking' - possible penalties for developers who fail to build?
As reported by Property Week, Gavin Barwell – the housing minister - wants to penalise developers who have "a habit of putting in planning applications, getting planning permission, getting uplift in their land value and then not doing anything".
The proposal is to make a developer's past performance on building out a factor in assessing new planning applications and this may be done by making it part of central government planning guidance.
Let's hope this is just an another "bright idea" that bites the dust! Proposals such as this demonstrate a failure to understand the real levers and drivers in the development world.
In practical terms this would be unworkable as it is frequently one party who obtains permission and another develops, and in commercial terms it fails to recognise that developers are in the business of development and, if they don't develop, it is usually because of sound commercial reasons.
Focusing on the issues of skilled labour, supply of materials and delays in the planning system would be a far more effective and constructive way of unlocking the problem. To take just one issue – we now have 50 brickworks where we previously had 80 and the upturn in the market has not been matched by an increase in brick production. To take another, we don't have enough trained plasterers or bricklayers, and whilst further education colleges are more than happy to train up new entrants to the profession, funding is still a barrier.
My plea to the housing minister is to listen the sector, understand the issues and deliver practical solutions and support. Don't create further barriers in the planning system and don't treat developers like children being sent to sit on the naughty step!