Why does land use planning affect the value of land and buildings?
Simply because the planning system controls both the use and supply of land and buildings for development. In short, most development in UK requires planning permission, and without planning permission it is against the law to either occupy or develop land or buildings.
Other things being equal, where demand is high for the use or development of land but where supply is constrained by the planning system, property values will remain high; the converse is true.
Why does this matter to me as an estate manager or property owner?
It matters because the value of your land and buildings will be affected by whether there are good or poor prospects of obtaining planning permission for the development that you are seeking in terms of:
- Disposing of land and buildings surplus to your operational requirements
- Changing the use of your buildings
- Extending, altering, demolishing or redeveloping your property portfolio
It is imperative that an assessment as to whether there are good or poor prospects of obtaining planning permission, and the associated time and cost implications, are fully understood as part of the asset manger’s estate strategy. In short, although values may be high for certain land uses and development as identified by your agent, the key question is whether these values can realistically be released through the planning system.
What do I need to do to protect by property interests?
It is important that you understand how the UK planning system works and ensure that the system is used to your advantage.
Outlined in the rest of this paper is a synopsis of the procedural elements of the UK planning system.