NPPF Reform + Planning and Infrastructure Act 2025: A Developer’s Plain-English Guide to the New London Planning Regime
Three planning reforms in eighteen months have rewritten how Greater London consents are won, financed, and delivered. The December 2024 NPPF reform. The second NPPF consultation that closed in March 2026. The Planning and Infrastructure Act 2025. Read together they are one continuous restructuring of the planning regime.
For the 2026 development finance market, this is not a regulatory footnote. It is a structural change in what schemes get consented, on what timeline, and at what affordable-housing threshold.
The three reforms in plain English
The December 2024 NPPF adopted the first round of housing-target reforms and reasserted the standard methodology for borough-level housing numbers. It also introduced the framework that would become the Time-Limited Planning Route in subsequent rounds.
The second NPPF consultation, closing March 2026, refined the Time-Limited Route specifically for London delivery, including the 20% affordable threshold by habitable room. This is materially more financeable than the previous 35% by units default.
The Planning and Infrastructure Act 2025 sits behind both, providing the statutory framework for grey-belt release, accelerated infrastructure cost allocation, and the cross-borough consent mechanisms that recently produced Earls Court.
What changes for capital pricing
The pricing table sets out the effect on developer underwriting. Three changes dominate.
Affordable threshold reduction. Schemes that elect into the Time-Limited Route at 20% by habitable room have improved viability headroom — typically £30 to £80 per square foot of GDV uplift versus the standard 35% framework.
Planning runway compression. Time-Limited Route schemes target ~18-month consent-to-start, versus 3+ years under the old regime. The faster runway tightens senior debt pricing because rate-environment risk is lower.
Affordable definition shift. The shift from per-unit to per-habitable-room counting changes the optimal product mix. 1- and 2-bed-dominant schemes now hit the affordable threshold with fewer “affordable” units than before.
What lenders are doing differently
Senior development finance prices Time-Limited Route schemes 25 to 50 basis points tighter than equivalent standard-route schemes, given the runway-risk reduction. Mezzanine appetite is broader for the same reason.
Forward-funding take-outs are competitively bid for Route-eligible schemes because the delivery cadence aligns with institutional capital deployment timelines.
For full regulatory analysis and capital stack benchmarks, see the Greater London Property Market Report 2026.
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This piece draws on Episode 2 of the Construction Capital podcast.
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Published by Construction Capital. 20-piece Greater London 2026 series.