Glossary definition
Viability Assessment
A financial appraisal submitted to the local planning authority to demonstrate that a development scheme cannot viably deliver the full policy requirements for affordable housing, S106 contributions, or CIL. Viability assessments follow the methodology set out in the NPPF and PPG, using standardised inputs for land value, build costs, and developer profit (typically 15-20% on GDV).
Definition
A financial appraisal submitted to the local planning authority to demonstrate that a development scheme cannot viably deliver the full policy requirements for affordable housing, S106 contributions, or CIL. Viability assessments follow the methodology set out in the NPPF and PPG, using standardised inputs for land value, build costs, and developer profit (typically 15-20% on GDV). They are often contested by councils and may require independent review, adding cost and delay to the planning process.
See also
Closely related terms.
Affordable Housing
Housing provided at below market rates to eligible households, including social rent, affordable rent, shared ownership, and First Homes, as defined by Annex 2 of the NPPF.
S106 (Section 106 Agreement)
A legally binding obligation negotiated between a developer and the local planning authority as part of a planning permission, requiring the developer to provide or fund specific community benefits such as affordable housing, public open space, or highway improvements.
CIL (Community Infrastructure Levy)
A charge levied by local authorities on new development to help fund infrastructure such as schools, roads, and healthcare facilities.
Gross Development Value
The total market value of a development upon completion, encompassing all units and any commercial elements.
Residual Land Value
The value of a development site calculated by taking the gross development value of the completed scheme and deducting all development costs including build costs, professional fees, finance costs, and developer profit.
Further reading
Guides that touch this term.
Guide
How Does Development Finance Work? A Complete Guide for UK Developers
A ground-up guide to how development finance is structured in the UK, covering loan mechanics, drawdown schedules, monitoring surveyors, and what lenders look for in your application.
5 min read readReadGuide
The Capital Stack in Property Development: How to Structure Your Funding
A comprehensive guide to understanding and structuring the capital stack in UK property development, from senior debt through mezzanine to equity contributions.
9 min read readReadGuide
Legal Due Diligence in Development Finance: What Solicitors Check
Legal due diligence is the backbone of every development finance transaction. This guide explains what solicitors investigate, common issues that delay completions, and how to prepare your legal pack.
9 min read readRead
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