Viability at appeal: what inspectors expect

Viability appeal inspector evidence comes down to four or five numbers. Benchmark land value, sales values, build costs and profit decide almost every viability case, and an inspector will spend the inquiry testing where those numbers came from rather than admiring the model that processed them. Everything else in the appraisal is arithmetic the parties can usually agree.

That has a practical consequence for how you prepare. The work is in the evidence behind each input, and in agreeing everything that is not in real dispute so the inquiry time goes where it matters.

Why these appeals narrow to a short list

The planning practice guidance on viability sets out standardised inputs, which removes most of the methodological argument. Both sides generally use a residual appraisal, both discount hope value from benchmark land value, and both work from existing use value plus a premium to the landowner.

What the guidance also does is shift the burden. Where a development is in line with an up-to-date plan, the guidance treats it as viable, so the applicant arguing site-specific viability has to show why the plan's own assumptions do not hold on this land. An inspector starts from that position.

And the guidance is explicit that the price paid for land is not, in itself, a justification for failing to comply with policy. That single sentence disposes of more appeals than any other part of the chapter.

Statements of common ground do the heavy lifting

On an inquiry, the statement of common ground is the most valuable document either side produces. It should reach the point where the only live figures are the ones actually contested.

Agree, in writing and before exchange:

• the development schedule, areas and unit mix
• the appraisal model, the base date and the appraisal period
• finance rate, acquisition and disposal costs, professional fees and contingency
• the policy requirement being tested and its source
• the sensitivity runs both parties want to see

Then set out the disputed inputs side by side, each with the party's figure and a one-line reason. An inspector reading that table knows exactly what the inquiry is for. Where the dispute is about a cost item such as highway works, the approach in highway works costs in a development appraisal is usually easier to agree than values are.

Do not use the statement to smuggle in a contested figure as agreed. It gets found, and it damages the witness who signed it.

Expert evidence and the standards that apply

Viability evidence at appeal is expert evidence, and the professional obligations are real. The RICS professional statement on financial viability in planning sets mandatory requirements for objectivity, impartiality, the declaration of interests and the duty to the process rather than to the client, and RICS has separate requirements for surveyors acting as expert witnesses.

Two things follow. A witness who has also advised on the land acquisition has a conflict that must be declared, and may not be the right witness. And a proof of evidence that reads as advocacy will be marked down, because an inspector can tell the difference between an opinion and a brief.

The practical test is simple. Would the witness give the same figure if instructed by the other side? If the answer is no, the figure needs re-examining before it is served, not during cross-examination.

What gets tested under cross-examination

Benchmark land value is where most inquiries spend their time. The questions are predictable:

1. What is the existing use, what income does it generate, and how was existing use value derived?
2. What premium has been applied, and what evidence supports it rather than convention?
3. If market transactions are relied on, were those sites subject to the same policy requirements, and how do you know?
4. Has hope value been excluded, and can you show the working?
5. How does your benchmark compare to the figure in the plan's own viability evidence?

Sales values come next. Asking prices and agents' letters carry little weight against completed transactions with addresses, dates and areas. Build costs get tested on the base date, the source index and whether abnormals are evidenced by an investigation report rather than an allowance. Profit gets tested on whether the chosen return reflects the actual risk, which on a pre-let or forward-funded scheme is lower than the developer's standard assumption.

Then there is the question that catches unprepared witnesses. What has changed since the appraisal was prepared, and what does the appraisal say on today's inputs? An appraisal 14 months old with no update is a gift to the other side.

Where applicants most often fall short

Appeal decisions are indicative of how inspectors have approached an issue rather than binding, so treat them as a guide to argument rather than as precedent. The recurring shortfalls map directly onto the guidance.

Overstated abnormals, where the contamination or the piling allowance is a round number with no site investigation behind it. Contingency applied twice, once in the cost plan and again as a line in the appraisal. Finance costs modelled at a rate no lender would charge for the stated facility. A profit on cost figure imported from a different risk profile. Space standards and accessibility requirements treated as optional extras rather than as policy costs, a point covered in space standards and accessible housing as appraisal inputs.

And the big one, which is a benchmark land value reverse-engineered from the price paid. If the existing use value plus premium calculation happens to land within 2 per cent of the purchase price, expect to be asked how that came about.

Costs risk

Costs can be awarded against either party at an inquiry or hearing where behaviour has been unreasonable and has caused the other side unnecessary expense. Viability cases generate two specific exposures.

For an appellant, serving an appraisal that is then substantially revised during the inquiry is unreasonable behaviour, because the authority has prepared against a case that no longer exists. For an authority, maintaining a refusal on viability grounds after its own independent reviewer has agreed with the appellant is equally exposed.

The way to manage both is the same. Get the independent review done before the appeal is lodged, and if it goes against you, reconsider the position rather than the witness. The process described in independent review of a viability appraisal is worth commissioning early for exactly this reason.

Preparing the appraisal for scrutiny

Write the appraisal knowing it will be read line by line by someone paid to find the weak input.

Each disputed figure should have a named source, a date and a document reference in an appendix that can be turned to during a session. The model should be supplied in a form the other side can run, with the inputs visible, because an appraisal that cannot be interrogated invites the inference that it should not be trusted. Sensitivities should be in the main document rather than produced late, including the runs that are unhelpful to your case.

One honest uncertainty is worth stating. Benchmark land value on a site with an unusual existing use, such as a part-let industrial yard with short leases, is properly arguable, and a witness who concedes a range rather than defending a single figure to the last question usually comes out ahead.

A Viability Assessment and the Affordable Housing Statement have to tell the same story, because any gap between them will be read aloud. PlanScope drafts both from your project answers and flags where a site-specific figure is missing, so the appraisal inputs still come from your valuer and your cost consultant. Reports should be reviewed before submission, and viability evidence for an appeal should be prepared by a suitably qualified valuer acting as an expert.

Illustrative example. A 45 unit scheme refused for offering 10 per cent affordable against a 30 per cent policy, with the dispute reduced by the statement of common ground to benchmark land value and sales values alone. The inquiry runs for a day and a half instead of four, and the inspector decides on two tables. That is what a good statement of common ground buys.

This is general guidance, not legal advice; take advice on appeal strategy from a qualified professional before relying on it.

PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.