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The revised National Planning Policy Framework (NPPF), published by the Ministry of Housing, Communities and Local Government (MCLG) on August 17, marks the most significant rewrite of England’s planning rulebook since Labour took office. For the living sector it brings a mix of certainty and unfinished business.
The Framework replaces the old “tilted balance” with a new three-tier decision-making structure (S3, S4 and S5) that sets out how applications should be assessed depending on whether a site sits within or outside a settlement boundary. Outside settlements, it introduces a “default yes” for residential schemes within roughly 800 metres — about a 10-minute walk — of a well-connected railway station, provided minimum densities of 35 dwellings per hectare (doh) are met, rising to 45 dph where service frequency is high. The government softened this from the 40-50 dph floor proposed at consultation stage.
Housing delivery has been a defining preoccupation of this government, with its well-documented and often-ridiculed 1.5 million homes target making headlines. Planning reform, long identified by developers and investors as the single biggest constraint on new supply, has been positioned as the primary lever for unlocking it.
Other changes with direct relevance to the living sector include an updated definition of build-to-rent — following the Renters’ Rights Act — that drops the previous reference to tenancies of three years or more; new accessibility requirements expecting 40 per cent of homes to meet the adaptable M4(2) standard; explicit recognition, for the first time, of large-scale shared living (coliving) alongside PBSA and later living as distinct typologies requiring their own management arrangements. A new paragraph supports mixed-tenure sites that include housing designed for older people, against a backdrop in which 18.6 per cent of the UK population is now aged 65 or over.
On Green Belt and Grey Belt land, the “golden rules” have also been recalibrated. Rather than the universal 50 per cent affordable housing requirement floated in the draft, developments must now provide affordable housing 15 percentage points above existing local plan requirements, capped at 50 per cent — with viability assessments able to reduce that obligation in limited circumstances, including on previously developed land.
The response from across the living sector has been broadly positive, tempered by concern that the Framework still treats BTR as a variant of build-for-sale rather than an operationally distinct asset class.
Brendan Geraghty, chief executive of the Association for Rental Living (ARL), which submitted to the NPPF consultation on behalf of its members, said: “The new NPPF provides a degree of planning certainty and for investors, this is a very positive step,” highlighting the ARL’s Investor Snapshot 2026, in which almost four in ten (38 per cent) senior institutional and long-term investors named planning reform as the single most powerful government lever for delivery.
“We also welcome the NPPF’s updated definition of Build to Rent following the Renter’s Rights Act, as well as its explicit development proposals to address specialist housing need including for older people, purpose-built student and for the first time, large-scale shared living accommodation. The acknowledgment that different housing typologies and tenures are required, including ongoing management plans for purpose-built student and large-scale shared living accommodation, as part of delivering a sufficient supply of homes, is encouragingMany of the Framework’s substantive reforms, designed to boost housing supply, align with the hallmarks of Build to Rent most notably the ability to build at pace and let over time, thus swiftly delivering the good quality, new rental homes in such great demand, in the locations they are needed,” Geraghty added.
Jessica McSweeney, partner at Carter Jonas, said: “The latest NPPF is broadly positive for BTR. It continues to recognise BTR as a distinct asset class and encourages local authorities to plan for rental demand where the evidence supports it. But while national policy increasingly recognises what BTR delivers, it still does not fully recognise how BTR schemes are funded, valued and operated. One useful change is the relaxation of the BTR definition, with the previous reference to schemes usually offering tenancies of three years or more removed. More generally, the NPPF’s emphasis on housing delivery at scale should support BTR development.”
“However, BTR is not simply build-for-sale housing for renters. Its investment model depends on long-term rental income and operational performance rather than the sale of individual homes. That distinction can have significant implications for viability, affordable housing and scheme design. National policy still leaves much of that detail to local plans and, in London, the GLA. The quality of local policy will therefore remain important in determining whether viable BTR schemes come forward,” she added.
“Perhaps the strongest opportunity comes from the NPPF’s support for higher-density development around stations and in well-connected urban locations. This fits particularly well with BTR. Renters are often less dependent on cars and tend to place a premium on access to public transport, employment and amenities. Major schemes at Wembley Park, Nine Elms and Canary Wharf demonstrate how effectively BTR can form part of high-density regeneration around strong transport connections. So overall I believe the NPPF creates a supportive backdrop for BTR. The next step is for planning policy to develop a more sophisticated understanding of the investment and operational model behind it, rather than treating the rental nature of the product as the principal difference,” says McSweeney.
Jonathan Walton, director and head of Boyer South, said: “The NPPF still does not give BTR proportionate attention. It does not engage as deeply as we had hoped with the very different investment and viability model that underpins BTR. There is still a risk of an implicit presumption towards market housing for sale, despite BTR being a distinct product with a different development, funding and investment structure.”
“Government guidance already recognises BTR as a distinct asset class, there is specific Planning Practice Guidance and it also has a strong presence in the London Plan. The opportunity was there for the NPPF to bring this together more explicitly and recognise that viability for BTR cannot simply be approached in the same way as build for sale. One of the difficulties is that the standard viability approach typically used by local planning authorities (LPAs) has been designed around build for sale. Section 106 viability mechanisms often include dual trigger points, such as at practical completion and at a later stage when a certain proportion of homes have been sold. That does not translate neatly to BTR, where practical completion and the sale of all homes to an institutional investor can take place almost simultaneously, meaning there is no future change in developer receipt for LPAs to seek clawback.”
“The stronger emphasis in the NPPF on higher-density housing around transport hubs fits particularly well with BTR which has a real role to play in high-density, well-connected locations and could help unlock a wider range of urban sites. In edge of settlement locations, BTR can also be provided as single-family housing, with this more attuned to the now-confirmed density of c. 40 dwellings per hectare and helping to accommodate families as well as individuals.”
“The new NPPF does not necessarily make particular types of sites more attractive to BTR than they were before, but it does provide greater certainty through the stronger ‘default yes’ approach and the additional weight given to housing delivery. That clearer policy direction is positive for the BTR sector because greater planning certainty is an important part of creating the conditions in which long-term investment can take place. Between the Planning Practice Guidance, the NPPF and the Government’s specific guidance on BTR, much of the policy framework already exists. What is missing is a stronger sense of integration. It would have been helpful for the NPPF to bring those elements together more clearly, particularly around viability and the characteristics that distinguish BTR from build for sale,” Walton added.
• What the new NPPF means by asset class
For BTR, the direction of travel is clearly positive: greater density certainty, a presumption toward well-connected urban and station-adjacent sites, and formal recognition as a distinct asset class should support the sector’s “build at pace, let over time” model. Because BTR delivery is not tethered to individual sales rates in the way build-for-sale is, it is also well placed to help the Government hit its wider build-out targets on large strategic sites, where a mix of tenures can bring homes forward faster than a single-outlet sales strategy would allow.
PBSA and large-scale coliving gain something they have lacked — explicit acknowledgement in national policy, including of the ongoing management plans these operational typologies require, which should help local authorities plan for demand rather than defaulting to conventional housing need assessments that were never designed with operational rental products in mind. Both Geraghty and Walton flagged this as an area where separating out demand assessment by tenure, rather than treating general housing need as a proxy for every product, would give authorities a far more realistic basis for local plan-making.
Later living stands to benefit from the new mixed-tenure provisions and expanded Grey Belt access, at a moment when almost one in five people in the UK is aged 65 or over and the Older People’s Housing Taskforce has been pressing for a step-change in supply. Even so, as with BTR, the golden rules’ affordable housing trade-off could blunt the opportunity on higher-value sites, meaning the sector’s ability to capitalise may still hinge on how individual local authorities choose to apply viability tests.
The NPPF has shifted national policy firmly in the living sector’s favour. We must hope that viability policy, largely a matter for local plans, will evolve quickly enough to convert that policy support into planning consents, and consents into completed homes.
