Rural Exception Sites: What the Fabian Society's Housing Report Means for Farmers

Rural exception sites are one of the few planning routes that allow small parcels of land next to villages to be released for affordable housing outside the normal planning process. A new report from the Fabian Society, titled "Quick Wins: Building More Homes in the Communities That Need Them," has put this policy back in the spotlight, highlighting a steep decline in the number of affordable homes delivered this way. For farmers and rural landowners across England, the findings matter because rural exception sites sit at the intersection of planning policy, land value, and the future of the communities that keep farm businesses and local services running.

What Are Rural Exception Sites, and What Has Changed?

A rural exception site is a small piece of land within or next to a village that would not normally be released for housing under the local plan. Instead of open-market development, the site is used exclusively for affordable homes let in perpetuity to people with a genuine local connection, usually delivered in partnership with a housing association or community land trust and supported by a rural housing enabler. It is one of the few tools that can bring new, affordable homes into small villages where normal market housing schemes are rarely viable.

The Fabian Society's report shines a light on how far delivery has slipped. It points to a fall of around 61 per cent in the number of homes completed through rural exception sites since 2015-16, down from roughly 1,020 homes a year to around 530. The report argues that these sites remain significantly underused given the scale of rural housing need, and calls for a renewed push to make it easier for landowners, parish councils, and housing providers to bring forward workable schemes.

Why the Decline Matters for Rural Communities

The decline in rural exception site delivery has several causes. Rising land values make landowners and parish councils more cautious about releasing sites, viability assessments have become more complex, and the number of dedicated rural housing enablers, who broker deals between landowners, parish councils, and housing associations, has fallen in many counties. Funding for small rural schemes can also be harder to secure than for larger urban developments, even though the need is just as pressing.

For villages, the consequences go well beyond housing numbers. When young families and key workers cannot find an affordable home locally, they are forced to move away, which affects school rolls, the viability of village shops and services, and the pool of local labour available to farms and rural businesses. For many farm employers, the ability to house staff and their families within reach of the farm is directly tied to the long-term sustainability of the business and the wider community it depends on.

Practical Implications for Farm Businesses

For farmers and landowners, renewed attention on rural exception sites is worth understanding, not just as a planning issue but as a business one. Land released for an exception site is usually valued above bare agricultural value but below full open-market residential value, since it carries a permanent affordable-housing restriction, so an early, independent valuation is essential before any decision is made. This can still represent a useful option for diversifying income from a small, awkwardly shaped, or otherwise unproductive parcel next to a settlement boundary.

Exception site schemes can also help farm businesses more directly, for example by securing affordable homes for farm workers or family members as part of succession planning, which in turn supports staff retention. Because these schemes fall outside permitted development rights such as Class Q, they require a full planning application demonstrating local housing need, so early engagement with the parish council, the local planning authority, and a rural housing enabler is important. Any decision to bring land forward should also be weighed carefully against succession plans and the potential tax implications, and we would always recommend speaking to a qualified tax adviser or solicitor alongside your planning consultant before committing land to a scheme.

How Foxes Rural Can Help

At Foxes Rural, our RICS and CAAV qualified team specialises in agricultural and rural planning, from Class Q barn conversions to rural exception sites, S106 agreements, and wider farm diversification strategy. Both the CLA and NFU have long argued that landowners should be properly supported and fairly rewarded for helping meet local housing need, and we work alongside that policy backdrop to help farmers turn a planning opportunity into a workable, well-valued scheme. If you are considering releasing land for affordable rural housing, or simply want to understand your options, call us on 01206 481981 or get in touch through our Contact page and we will talk you through the next steps.