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In May 2016 the Vacant Building Credit ("VBC") was reintroduced via the National Planning Policy Guidance ("NPPG"). VBC applies to any building that has not been abandoned that is brought back into any lawful use, or is demolished to be replaced by a new building. VBC is equivalent to the existing gross floor space of relevant vacant buildings when the local planning authority ("LPA") calculates affordable housing contributions - VBC has the effect of reducing the amount of affordable housing ordinarily required.

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The Vacant Building Credit Lottery

16 December 2016

In May 2016 the Vacant Building Credit ("VBC") was reintroduced via the National Planning Policy Guidance ("NPPG"). VBC applies to any building that has not been abandoned that is brought back into any lawful use, or is demolished to be replaced by a new building. VBC is equivalent to the existing gross floor space of relevant vacant buildings when the local planning authority ("LPA") calculates affordable housing contributions - VBC has the effect of reducing the amount of affordable housing ordinarily required.

However, the NPPG is silent on the timing for the calculation and application of the VBC other than it needs to be calculated at the time of setting the affordable housing percentage. The absence of information with regard to how long a building must be vacant prior to calculating the affordable housing percentage leaves it up to each LPA to produce advice for their area, causing a number of discrepancies in guidance across the country.

Research of various LPAs' policies suggests that the application of VBC can differ from authority to authority. Policies range from applying VBC when buildings are vacant at the time of the application to requiring buildings to be vacant on determination of the application. One London Borough Council's approach is to only allow VBC in circumstances where a vacant building "….has been in lawful use for less than six months within three years ending on the day planning permission first permits the chargeable development".

The policy is designed to incentivise brownfield development by re-using or demolishing existing and redundant buildings.  It therefore makes it questionable whether an LPA should have a policy that such buildings be left vacant for any period of time either before an application or during the period for determination. Arguably, such policies may have the effect of incentivising vacancy thereby defeating the objective of the policy and leading to an increase in the length of time that redundant buildings are left vacant.  

Definitive guidance from the Government on the requirements and timings when processing an application for VBC would be preferable to the current VBC lottery. 

This article was written by Graham Cridland and Holly Lawrence.