Impact on apartment delivery costs of change in apartment standards

The theory behind the recent changes to "Planning Design Standards For Apartments" is relatively simple:

1. Smaller Floor Area = Less Construction Cost
2. Less Dual Aspect and Amenity = Lower Complexity. Improved Efficiency
3. Simplified Planning ("permitted modifications") = Faster Timelines
4. Higher Density = Better Site Efficiency & Lower Per Unit Land Costs

The caveat is around will the savings be passed on?

The quantum of saving is not clear without detailed cost modelling of full developments, however, high level modelling of a consented 100 unit development gives indicative order of magnitude savings as indicated - these savings may not be quite as high as those noted at the standard's launch. Changing the mix on an owned site may also give additional savings on account of lower per unit land costs and possible improvements in nett:gross ratios - this prospective change is not without additional planning risk and programme impact. These savings will lead to improved affordability with lower household incomes required to purchase units. Removal of VAT would also lead to additional improvements as indicated.

It will be critical in implementation to ensure that minimum quality, safety, sustainability and habitability standards are maintained given that small deviations from the new standards could make a small unit unlivable.

​Planning Permission will still be required. The "permitted modification" (the proposed s44B PDA 2024) only applies to altering an already permitted scheme in line with the new Guidelines. The only 'faster' element, therefore, is that a new substantive permission will not be required in order to effect such alteration.