Earlier this month, National Planning Fees saw their first increase since 2012. Why such a hefty increase, and what does this mean for property developers? Our brokers discuss.

 

How is the Cost of Planning Applications Changing?

On January 17th 2018, the UK Government gave local authorities the ability to raise National Planning Fees by 20%. This means a householder extension application will now cost £206 (previously £172), change of use will be £462 (previously £385), whereas the small agricultural building fee will be £96 (previously £80).

 

(source: The Town and Country Planning Regulations 2017)

 

Originally planned for summer 2017, these regulations have now also introduced a new fee of £402 per 0.1 hectare for permission in principle applications. Furthermore, there will now be charges on applications where permitted development rights have been withdrawn by Article 4 or planning conditions. This was previously free.

 

Why the Hike?

Well, The Local Government Association has previously complained that councils would miss out on £70m in planning fees without the increase and there has been great debate whether existing fees accurately reflect the cost of processing an application.

 

How Will the New Planning Application Fees Affect the Industry?

Although the process will now be more expensive, planning fees are relatively small compared to the overall price of development therefore we don’t expect this will put off investors or greatly affect the number of planning applications that are submitted each month. In fact, many property developers are hoping this extra cost will speed up the planning process which is known to be slow due to over-stretched departments.

A RIBA spokesperson has said:

‘There is a huge shortage of resources in local planning departments so we understand the appeal of raising fees. However, this cannot be a substitute for proper funding and it is vital that any additional revenues raised are reinvested in planning services.’

 

Let Us Help With Finding Development Finance

If you’ve been doing your sums and you’ll need a loan for your next project, discover our development finance services.

Alternatively, read more about UK planning permission in our post: Revealed: The Easiest (and Hardest) Places to Get Planning Permission in England