While there is still a long way to go regarding the fight against the coronavirus the UK government seems more focused on economic recovery at the moment. As a consequence, property investors were overjoyed to hear plans to make major changes to the planning application system. In what the Prime Minister described as the most radical reforms since the Second World War, many property investors are now starting to look forward with hope and anticipation.
Regenerating vacant commercial premises
Since the Internet became an integral part of daily life and a leading light in the world of retail, the UK high street has been under huge pressure. We have seen established names fall by the wayside, blue-chip companies seeking financial bailouts and just recently the “recession proof” John Lewis announced shop closures and redundancies. In many towns and cities up and down the country once blooming high streets became desolate wastelands of empty properties. This comes at a time when demand for homes is rising and new build numbers are just not keeping up.
Some of the major changes with regards to property regeneration include:-
• An extended range of commercial buildings can now be converted to residential use without the need for a planning application
• Vacant/redundant residential and commercial buildings can now be demolished without “normal planning application” consent if they are rebuilt as homes
• Extended powers for homeowners to build up from their existing properties with a fast-track approval process, subject to neighbourhood consultation
It is safe to say that overnight the value of many vacant high street/commercial properties have jumped in value. At a time when the UK economy is struggling, an additional £5 billion investment in infrastructure, as well as changes to the planning application system, has been well received.
Empty rhetoric or real change
There is no doubt that the devil is always in the detail with regards to government policy changes but the announcement on planning applications makes perfect sense. We have seen numerous commercial/retail developments falling empty with the previous planning system unhelpful when looking at conversions to residential property. As a consequence, it is fair to say that billions of pounds of property have remained unused for far too long. There is now the opportunity to rebuild thriving communities, tackle the housing crisis whilst injecting huge amounts of capital into the UK economy – saving countless jobs.
While there has been peripheral noise regarding previous empty promises, regurgitation of historic schemes and policies, the fact is that the monumental change to the planning application system is a game changer.
We have become so used to the current low interest rate environment that it is easy to forget how cheap finance is at the moment. So, while the huge changes to the planning application system will support the next wave of property investment in the UK, lenders will be rubbing their hands. This is likely to introduce huge competition into the lending sector with homeowners and property developers likely to benefit as finance costs are cut to the bone. All of a sudden the UK property market seems alive again!