Before they put their Battersea Park home on the market, retired diplomat Richard Ralph, 66, and his wife Jemma, 38, a solicitor, were granted planning permission to extend the property's kitchen. They plan to move to Sandwich in Kent with their 22-month-old daughter.
© Matt Writtle
Obtaining planning consent earlier this year cost them about £5,000 and took, Richard estimates, about two weeks' work in total. "We both did it when we could, and you can do much of it online," he says. "We didn't find it a great hassle or unduly time-consuming."
And the effort paid off. The five-bedroom house sold within about a month for £880,000 — only £20,000 less than their original asking price.
Read our top tips on applying for planning permission.
Tempting the buyer
Richard does not believe the planning consent added much to the value of the property but feels that its presence helped tempt their buyer. The property has been bought by two architects who plan to carry out the work.
Jimmy Carr, who handled the sale for Kinleigh Folkard & Hayward, believes the fact that the planning consent had been granted helped the buyers decide on the house. "They want to put their own stamp on the house and this gave them peace of mind," he says.
And there is a bonus: the usefulness of marketing a home with a "shovel-ready" extension project will become even greater over the next two years as London councils begin to adopt the Community Infrastructure Levy. This new local tax will apply to substantial extensions — of 100 square metres or more — as well as all new builds.
© Harrison Price
A two-tier tax system: Community Infrastructure Levy
The charge will be made per square metre. Many councils will adopt a two-tier system, charging more for building work in the smarter parts of their area.
Mayor Boris Johnson has already imposed a charge for this kind of project — £50 a square metre in Zone 1, £35 in Zone 2 and £20 in Zone 3. Most local authorities are currently consulting on their charging schedules and plan to introduce them within the next 12 to 18 months, and there will be a considerable variation in fees.
For example Lewisham council is considering charging between £70 and £100 a square metre for house extensions from next April/2014. Kensington and Chelsea also intends to introduce the levy in early 2014, but its proposed pricing range is from £100 to £650 per square metre.
Islington council is consulting on a £300 charge it intends to impose later this year, while Ealing proposes a fee is £35. Bexley council is proposing fees of between £40 and £60 a square metre, to be introduced in April 2014. Hackney council will also introduce fees next year, but has not yet published proposals on how much it plans to charge.
The only way legally to avoid the charges is to start work before they are officially launched in your borough.
Lindsay Cuthill, a director of Savills based in west London, believes a live planning consent for a home improvement will certainly add to a property's saleability though not necessarily to its selling price. He believes the more ambitious the plans are, the more likely buyers are to pay a premium.
"It depends on what you are proposing," he says. "If it is something like a loft extension it is the sort of thing that might be seen as such a given that the next person would be able to get consent that they won't pay any more for it.
"But if it is something a bit more unusual and contentious and you have done your research and think you will get consent, then people might be willing to pay a premium. It also demonstrates how the property could be improved."
Cuthill points out that savvy buyers will consider both the cost of the property plus the cost of the project, and will be unlikely to pay you more than the potential uplift they can make in for you having done the planning legwork.
Cost of applying for planning permission
Martin Bagshaw, director and head of planning at John Martin Associates, estimates the typical cost of applying for planning permission, including council fees and the cost of architects and surveyors, would be about £5,000 excluding any new levy.
"You really have to strike a balance between what it will cost and what value it could add," he says.
The wildcard in the mix is, of course, contentious government proposals to relax planning rules for homeowners, allowing people to carry out more extensive works on their homes than currently allowed without planning consent. "Until we have seen the detail of that we really don't know where we are," says Bagshaw.