Section 106 charges gone

The government has announced that councils in England will no longer be applying Section 106 charges on smaller residential building schemes. This means it will now be cheaper and easier to build new properties or bring disused buildings back into use.

S106 agreements or ‘developer contributions’ have been traditionally imposed by councils when dealing with schemes for new development. The charges can vary significantly and are usually used to make a development proposal that would otherwise have been rejected acceptable in planning terms. For example, you may be asked to pay some money to provide infrastructure or affordable housing.

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This is good news for small developers and self-builders as, in the government’s own words, the changes will ‘ensure any builder helping to turn someone’s dream home into a reality … doesn’t get lumbered with Section 106 charges’.

Small sites - specifically those with ten homes or fewer - will not be expected to stump up the charges. The government also confirmed that in very rural areas, sites of five homes or fewer should not face the charge.

Note that this change does not apply to Wales. Speak to your local authority today for guidance on what they are doing with their Section 106 charges and obligations. Find your local authority using our postcode finder.