Planning Gain and Obligations: Promise and Performance of Part V (Social & Affordable Housing)

Planning gain is based on the idea that land values are enhanced by the actions of the state or community, for example, through land use zoning and infrastructure provision, both of which increase the value of land.Landowners may have done little to cause an uplift in land value and may achieve what are called ‘windfall gains’ when land is purchased by a developer. There are many methods of seeking to capture some of this value uplift for the community and one is to impose planning obligations to develop social and affordable housing as a condition of planning consent. Such housing can be on the site of the relevant planning permission or elsewhere in the locality.As developers will factor in the planning obligations as part of their development appraisal, such obligations will result in a lower land price to the landowner, and planning obligations attempt to capture the difference between the market and existing use value of land. However, this depends on the assumption that the state is paying actual, as opposed to inflated, land values for Part V housing. If the state pays inflated prices this, in turn, inflates land values and undermines the objectives of Part V. The primary aim of this study is to evaluate the effectiveness of Part V of the Planning and Development Act 2000 and, in particular, to assess how it has operated since the major reforms made as part of the Urban Regeneration and Housing Act 2015.