Rising costs prompt new homes plan rethink

The Lutterworth East development was approved in 2020

Leicestershire County Council has announced a revised action plan for a major development near Lutterworth.

The authority secured planning permission from Harborough District Council in 2020 to create 2,750 new homes and 36 acres of business space at the Lutterworth East site.

But now it says rising construction costs and a "stagnant" housing market have prompted a rethink.

The new action plan involves the business space - a distribution site - being created first so companies can move in, with the homes being built later in phases.

A reduction in the proportion of affordable housing is also being proposed, with the county council pledging to discuss the most suitable number with the borough council.

The authority said it hoped to find a developer for the distribution site later this year, with a 2026 target for work to begin.

'Need to be shrewd'

Councillor Lee Breckon, cabinet member for finance and corportate resources, said: "The world has changed, with Covid, inflation and rising construction prices almost doubling the infrastructure cost of this project.

"Across the country, inflation costs are putting schemes under water but we're determined to find the best way to generate jobs and much-needed homes.

"This is a complex project. We've thought long and hard about next steps and independent assessments show that phasing development and sales to ensure a financial return is the best approach.

"We need to be shrewd and that's why we're focused on making it financially viable and attractive to developers, reducing the risk to council taxpayers."

A Harborough District Council spokesperson added: "We confirm that we have received an application that proposes the removal of a restriction on the unit size for the distribution site on the proposed Lutterworth East development.

"This application will be considered by the council in due course."

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