Greenbelt housing: a boost to landowners or an increase in government control over development?

The Labour government has now given further details surrounding its ambitious pledge to build 1.5 million new homes by 2030. New powers are being proposed by ministers to allow councils to compulsorily buy up green belt land that would previously have been ineligible for development.

The decision is largely a reaction to ongoing concerns that, in order to meet housing targets, development would not just be needed  on so called ‘grey belt’ sites, but also on previously undeveloped green belt land. The concept of ‘grey belt’ refers to low quality land that has little utility and could be developed on - overall, this land covers roughly 13% of the country’s total land area. Whereas green belts were initially introduced to prevent towns and cities from encroaching upon one another, and therefore have not been developed upon.

Opportunities for landowners?

This development opportunity could potentially have been viewed by landowners as a new opportunity to garner investment and increase the value of previously unprofitable land, however, the government appears to be looking to curb this.

A cap on the amount of profit that can be made from the sale of this land is being introduced to ensure development is prioritised. In addition to this, landowners that refuse to sell in parts of the country  that have a greater housing need could be subject to compulsory purchase orders, whereby the land is bought at a value lower than market value of similar sites outside of the green belt area.

This could be especially relevant in areas of high property prices, where ministers are consulting on plans to set a ‘benchmark’ value for land, capping the amount that landowners could receive. This could also lead to compulsory purchase powers being implemented. The government argues this is designed to allow land to be bought at a fair value, rather than at an inflated price often linked to the value of planning permission in the future.

Are changes imminent?

Ministers are currently consulting on the plans to rewrite the National Planning Policy in a move that would force councils to identify enough land in local plans to meet their future housing needs. The move comes alongside the proposal that 50% of the new homes should be affordable housing within any green belt land that is developed on.

Concerns – a practical solution, or incentive to land bank?

Whilst the efforts to eliminate the housing crisis will be welcomed by many, criticism has come from experts who believe that the ‘landowners vs government’ approach could lead to supply dwindling, with many landowners sitting on property and refusing to sell, believing the land has been undervalued, whilst waiting for the policy to change once more. In addition, compulsory purchase order power can be a lengthy process and will not assist with the imminent supply issue.

If you have queries regarding your land sale, purchase, or the potential for development, please get in touch with one of the experts in our team today to find out how we can assist.

These notes have been prepared for the purpose of articles only. They should not be regarded as a substitute for taking legal advice.