BLOGS

England's planning system is in the middle of its most consequential reset in a decade

When the Labour government reinstated mandatory housing targets in late 2024 — setting England's collective ambition at 370,000 new homes per year — it sent a clear signal to local authorities: the era of discretionary target-setting was over. The revised National Planning Policy Framework (NPPF), published in December 2024, sharpened the teeth of housing delivery requirements, strengthened the five-year housing land supply test, and introduced the "grey belt" concept to unlock lower-value Green Belt land for development.

Now, nearly two years on, councils are at very different stages of responding. Some have moved fast, pushing through updated local plans to lock in allocations before further policy shifts arrive. Others remain paralysed, caught between the political sensitivity of densification, legal challenges to grey belt designations, and the sheer resource demands of accelerated plan-making. The result is a highly fragmented pipeline — and for developers, investors and lenders, knowing which authorities are ahead of the curve has become a material due diligence question.

The policy pressure cooker: NPPF, the Planning and Infrastructure Bill, and viability reform

The December 2024 NPPF revision was only the opening move. The Planning and Infrastructure Bill, introduced in early 2025, proposes to go further still: streamlining the plan-making process from an average of seven years to a statutory maximum of 30 months, introducing Infrastructure Levy as a replacement for Section 106 and Community Infrastructure Levy, and giving the Secretary of State new powers to intervene where local plans are deemed out of date or non-compliant.

For councils that have historically used drawn-out plan-making as a tool to manage — or limit — housing growth, the new framework removes much of that flexibility. The default position under the new NPPF is now strongly pro-development: where an up-to-date local plan is absent, planning applications are assessed against a "presumption in favour of sustainable development," a lever that developers have already begun using aggressively in planning appeals.

Development viability, meanwhile, has shifted meaningfully. After the sharp spike in construction material costs in 2022–23, input price inflation has moderated. REalyse data shows that build cost assumptions in viability assessments across much of the Midlands and North of England are now producing residual land values sufficient to unlock schemes that were unviable as recently as 18 months ago. In London and the South East, the picture is more nuanced: land values remain high, but improved sales price assumptions — particularly for mid-market and affordable-led schemes — are helping marginal sites cross the viability threshold.

How councils are responding: acceleration, resistance, and the plan-making gap

REalyse planning data reveals a clear split in local authority behaviour across England's 317 lower-tier planning authorities.

A first group — concentrated in urban areas with acute housing pressure, including several London boroughs, West Midlands authorities, and districts around Manchester and Leeds — have moved quickly to adopt or submit updated local plans. These authorities are now in a position to allocate strategic sites, engage with the Infrastructure Levy framework early, and provide the policy certainty that unlocks development finance. In these areas, the planning pipeline visible in REalyse data shows a meaningful uptick in applications for schemes of 50 units or more since Q1 2025.

A second, larger group has entered a period of managed delay. Many of these councils have declared their intention to produce a new local plan but have not yet submitted for examination. Some are explicitly waiting to see how the Infrastructure Levy regulations are finalised before locking in planning obligations policy. Others face political resistance to specific site allocations — particularly grey belt and urban fringe designations — that is slowing progress through their democratic processes.

A third group — particularly among smaller district councils and some London boroughs — has effectively stalled. Their existing local plans are materially out of date, leaving them exposed to speculative applications and appeal losses. For developers tracking pipeline opportunities, REalyse data flags these authorities as high-activity appeal zones, where permissions are increasingly being granted on appeal rather than through proactive allocation.

The grey belt effect

The introduction of "grey belt" — broadly defined as previously developed Green Belt land or Green Belt that makes a limited contribution to the original purposes of designation — has added a new and contested dimension to local plan-making. Several authorities have challenged grey belt designations through judicial review, creating uncertainty that has paused some plan reviews in Home Counties and outer metropolitan areas.

Where grey belt allocations have survived scrutiny, however, the impact on the pipeline is tangible. REalyse analysis of planning applications in authorities where grey belt land has been formally identified shows a measurable increase in outline applications for residential-led schemes, with gross development values typically in the range of £25m to £150m depending on scale and location. Lenders and investors tracking these emerging allocations are increasingly using REalyse data to model residual values and yield assumptions ahead of planning certainty.

What this means for housing delivery in 2026 and beyond

The fundamental question is whether accelerated plan-making translates into accelerated housing completions — and the honest answer is: not immediately, and not evenly.

Even where councils are moving quickly, the lag between local plan adoption, site allocation, detailed planning consent, discharge of conditions, and eventual construction start means that the 2026 completions pipeline is largely already set. The more meaningful question is what the 2027–2029 pipeline looks like, and here the variation in local plan progress becomes critical.

REalyse data suggests that authorities with adopted or near-adoption local plans in 2025–26 are already showing stronger forward pipelines — more outline permissions, more reserved matters submissions, more discharge-of-condition activity — than their peers still in the plan-making process. For a housebuilder or build-to-rent operator assessing land acquisition strategy, this distinction is increasingly the primary screen.

For lenders and investors, the risk calculus is similarly shifting. A scheme in a district with an up-to-date local plan, a supportive five-year land supply position, and an active housing delivery test result carries materially lower planning risk than a comparable scheme in a stalled authority — even if the underlying land economics look similar. REalyse's planning pipeline data, layered against local authority plan status and appeal decision records, is helping institutional investors price this planning risk differential with greater precision.

The Infrastructure Levy transition also bears watching. Once enacted, it will change the economics of affordable housing delivery and planning obligations in ways that are not yet fully modelled into land prices. Early-mover authorities adopting the new framework first may see short-term disruption to deal flow as the market recalibrates land values.

Outlook: a two-speed pipeline, and where the opportunity lies

England's housing delivery system in 2026 is best understood not as a single national pipeline, but as a collection of highly localised sub-markets, each operating at a different stage of the planning reform cycle. The authorities that moved earliest to align their local plans with the new NPPF and embrace the grey belt and urban uplift agenda are already seeing the benefits in pipeline depth.

For those still in limbo, the government's willingness to use intervention powers — including designating areas as "housing delivery zones" subject to streamlined consent — represents both a threat and, potentially, an opportunity for developers willing to engage early with the process.

The data is increasingly available to make these distinctions. Councils racing ahead are visible in planning application volumes, outline consent rates, and discharge-of-condition activity. Those stalling are equally identifiable — through appeal decision patterns, ageing local plan base dates, and slowing site delivery rates. In a market shaped as much by policy timing as by economics, intelligence on plan-making progress may be among the most valuable inputs a property professional can have.