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How to prepare a valid planning application

Other supporting documents – for small schemes (1 - 9 new homes)

Our planning policy (Policy P1) requires any development which creates one or more homes to contribute to the provision of affordable housing in Southwark.

Where affordable housing cannot be provided on or off site, a payment in lieu is usually the most realistic and deliverable option. The financial contribution will go towards the provision of affordable housing in the borough. 

Make sure you have also reviewed the forms, plans and drawings and general supporting documents needed for all applications.  

Developments where the affordable housing contribution applies

Developments where the affordable housing contribution does not apply

  • Extensions to existing residential buildings to create a new additional home or homes
  • New build - construction of new homes on vacant land. This includes infills and new homes in gardens
  • Change of use or conversion of a non-residential building to a new home or homes
  • Subdivison of a home to create two homes or other subdivisions 
  • Demolition of a home or homes and re-building more homes
  • New build Houses in Multiple Occupation (HMOs) (use class C4 or sui generis)
  • Change of use from a non-residential use to an HMO (use class C4 or sui generis)
  • Change of use from an HMO (sui generis) to homes (C3)
  • The replacement of a single home
  • Converting two or more homes to one home (de-conversions)
  • Extensions to residential buildings or domestic home extensions that do not result in additional homes
  • Change of use from an HMO (C4) to a dwelling (C3)
  • Change of use from a dwelling (C3) to an HMO (C4)
  • Self build properties unless the property is put on the market within three years of occupation. The calculation of the affordable housing contribution, and a viability appraisal (unless following a fast track route) and a legal agreement will still be required. 

How does the policy requirement apply?

The affordable housing contribution is calculated on the basis of 35% of the habitable rooms of the entire development. The payment required will be the maximum viable amount with a 35% minimum expectation, unless the viability of the scheme demonstrates otherwise. The following minimum payments apply, subject to viability:


Viability appraisal required  

Viability appraisal not required (fast track) 

CIL Zone 1 and 2 

35% at £100,000 per habitable room  

40% at £100,000 per habitable room 

Aylesbury Area Action Core  

35% at £100,000 per habitable room 

60% at £100,000 per habitable room 


CIL Zone 3 

35% at £82,000 per habitable room  

40% at £82,000 per habitable room 


Self build properties anywhere in the borough  

35% at £30,000 per habitable room  


40% at £30,000 per habitable room 



  • Viability Appraisal

    Where the fast track route is being followed viability appraisal is not required.

    In all other cases, a financial viability appraisal will need to be submitted with an application and independently reviewed. The financial viability appraisal should be prepared in accordance with the Development Viability SPD

    A legal agreement is required in all cases which will include a late-stage viability review clause to check if the viability has improved once the new homes have been built.

    What you need to do

    When is it needed?

    Why is it needed?

    Further guidance

    Step 1: Provide a detailed viability appraisal to include:

    • an executive summary outlining the key conclusions being drawn from the appraisal in plain English

    • a fully testable editable electronic or software model which explicitly shows the calculations and assumptions used in the planning application

    Step 2: You must pay for the review of the financial viability appraisal or provide a solicitor’s undertaking to pay.

    Step 3: An independent review of the financial viability appraisal is undertaken on behalf of the Council 

    Step 4: A legal agreement will be completed to secure on-site affordable homes or a financial contribution towards the delivery of affordable homes in the borough. 

    Provide up to date title information (register and plan) for the red-line site and a solicitor's costs undertaking to cover the council's cost of negotiating, agreeing and completing the s106 legal agreement. 

    All schemes proposing nine homes or fewer where the fast track route is not being followed.

    Please see the table above.

    To ensure a transparent and accurate assessment of the viability of the proposed scheme.

    To demonstrate that planning policy requirements are being met for affordable housing. 


    Relevant planning policy:
    • Southwark Plan 2022 policies SP1, P1, IP3, P9

    Refer to the council's Development Viability SPD

    Refer to more information about Section 106 agreements 


    Refer to further information on Land Registry (external website) 

    Make sure you: 

    • see Southwark Plan 2022 policy P1 for a detailed definition of a habitable room
    • where on-site affordable housing provision is proposed, the applicant will need to confirm in writing that they have a Registered Provider who agreed to deliver the affordable homes 
    • where on-site affordable housing is proposed, the provision will be rounded up to the nearest whole number for habitable rooms where required
    • meet the cost of the council's legal fees for confirming and finalising the agreement, title and dealing with completion; this is charged at £250 an hour for non-GLA referable schemes. VAT is not payable
    • Submit the correct self-build documentation when proposing a self build property

    Your viability assessment should include: 

    1. A scheme specific elemental build cost summary setting out preliminaries, demolition/site clearance/site preparation, base build costs, abnormal costs, contractor’s overheads and profit and exclusions and assumptions. It must also include GIA floor areas with gross to net ratio.
    2. The residual cash flows submitted must calculate the residual land value (RLV). Residual profit with a fixed land value inserted will not be acceptable. 
    3. The RLV must be cross-checked against market site transactions for sites that have been sold with planning consent including a schedule of site comparables to be included with fully justified analysis to facilitate a cross-check. 

    How do we define a habitable room?

    A habitable room is a room in a house that has a window and is intended to be used for sleeping, living, cooking or dining. This is regardless of what it is actually used for. This definition excludes enclosed spaces such as bathrooms or toilet facilities, corridors, landings, hallways, lobbies, utility rooms or kitchens smaller than 11sqm. Any floor area where the ceiling height is less than 1.5m will not count as habitable floor space. 

    Payment in lieu examples (In CIL zones 1 & 2); 

    for CIL zone 3 apply £82,000, for self build apply £30,000:  

    Worked example 1

    Development proposes 1 new 1-bed home on a previously developed site.

    • Habitable rooms = 3 (kitchen, lounge, bedroom)
    • 35% requirement:
    • 35/100 x 3 = 1.05
    • 1.05 x 100,000
    • £105,000 payment due
    Worked example 1A: Small Site Fast Track (not in Aylesbury) 

    Development proposes 1 new 1-bed home on an empty site 

    • Habitable rooms = 3 (kitchen, lounge, bedroom) 

    • 40% requirement: 

    • 40/100 x 3 = 1.2 

    • 1.2 x 100,000 

    • £120,000 payment due 

    Worked example 1B: Self-build 

    Development proposes 1 new 1-bed home on an empty site 

    • Habitable rooms = 3 (kitchen, lounge, bedroom) 

    • 35% requirement: 

    • 35/100 x 3 = 1.05 

    • 1.05 x 30,000 

    • £31,500 payment (due on completion if the property is sold within 3 years of first occupation) 

    Worked example 1C: Self Build - Fast Track (not in Aylesbury) 

    Development proposes 1 new 1 bed home on an empty site 

    • Habitable rooms = 3 (kitchen, lounge, bedroom) 

    • 40% requirement: 

    • 40/100 x 3 = 1.2 

    • 1.2 x 30,000 

    • £37,800 payment due (due on completion if the property is sold within 3 years of first occupation) 

    Worked example 2

    Development proposes the subdivision of a three bed flat into 1 x 2 bed flat and a studio flat. The studio has a floorspace of 39sqm, which under policy P1 (factbox) equates to 2 habitable rooms.

    • habitable rooms = 4 (kitchen, lounge, 2 bedrooms) + 2 (studio of 39sqm) = 6
    • 35% requirement
    • 35/100 x 6 = 2.1
    • 2.1 x 100,000
    • £210,000 payment due
    Worked example 3

    Development proposes a roof top extension to provide 5 new 2 bed homes (net increase of 5 homes).

    • habitable rooms = 20 habitable rooms (kitchen, lounge and 2 bedrooms in each)
    • 35% requirement
    • 35/100 x 20 = 7
    • 7 x 100,000
    • £700,000 payment due

Page last updated: 21 November 2023


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