Inspector in Exeter planning appeal decision addresses the role of student accommodation in housing supply

A recent planning appeal decision has considered the issue of whether student dwellings should be included in housing supply figures. Planning authorities currently have to demonstrate a 5 year housing supply (increased by 20% should there be a record of persistent under delivery). A failure to do so leaves them vulnerable at appeal should housing schemes come forward, even for locations the authority does not favour. 

In this case, the developer appealed against Exeter City Council's decision to refuse to grant outline planning permission in January 2014 for 120 dwellings at Pinhoe in Exeter. A key debate during the appeal was the extent of the City Council's housing supply, whether it could demonstrate 5 years, and whether it could take student accommodation into account.

The latter issue was critical, as the appeal decision cites that the number of students in Exeter has increased dramatically by around 44% in the last 5 years and students make up about 16 % of the Exeter's population. The City Council sought to rely on what would appear at first glance to be relatively straightforward guidance in Planning Practice Guidance (PPG – the national planning guidance webpages) that student accommodation can be included towards the housing requirement 'based on the amount of accommodation it releases to the housing market' that would otherwise be occupied by students.

However, in this case the Inspector concluded that the City Council could not avail itself of the PPG for three reasons:

  1. The inclusion of student accommodation by the City Council was not consistent with the PPG because there was no accompanying assessment or evidence of how much market housing was released by the provision of student accommodation.
  2. There has been a considerable increase in the number of students relative to the provision of purpose built accommodation and so not only has there been no reduction in market dwellings occupied by students, there has been 'a significant increase'.
  3. The Inspector concluded that student accommodation did not form part of the objectively assessed need set out in Exeter's Core Strategy, and therefore could not contribute towards meeting the identified housing requirement.

This is a significant decision, as removing student accommodation meant the Inspector deemed the City Council to fall short of a 5 year supply and this proved to be a strong material consideration in favour of the appeal, which was allowed with costs awarded against the City Council. Of tangential interest, it is also notable that the Inspector imposed only 13 conditions on the permission, a low number and in our experience fewer than would normally be imposed by a planning authority. 

It remains to be seen whether the decision will be challenged by the City Council. Watch this space. If it is not challenged it could have a significant ramifications for future planning decisions in Exeter until the City Council addresses the lack of evidence as to the impact of student accommodation on the supply of market dwellings.

For more information please contact Lucy Smallwood, Partner and Head of the Residential Development team on 01392 687555 or lucy.smallwood@michelmores.com