The regulatory landscape
Building Regulations have changed more in the last 3 years than in the previous 20. For developers, this means build specifications from even 2–3 years ago are no longer compliant. Every new project must be designed to current standards — and the cost impact is significant.
Key changes
Future Homes Standard (Part L)
All new homes must produce 75–80% less carbon than 2013 standards. Heat pumps replace gas boilers, triple glazing becomes standard, insulation and airtightness requirements are substantially tightened. Adds 5–10% to build costs. See our detailed Future Homes Standard guide.
Part O — Overheating
All new residential buildings must assess and mitigate overheating risk. This may require specific glazing ratios, external shading, cross-ventilation, or mechanical cooling. The impact varies significantly by orientation and location — south-facing apartments in London are most affected. Adds £500–£3,000 per unit depending on mitigation measures needed.
Second staircase (18m+ buildings)
Residential buildings over 18m must now have two staircases. This is the most impactful change for apartment developers building taller schemes. A second staircase reduces the lettable/saleable floor area by 5–10%, fundamentally affecting the development appraisal for tower schemes. Buildings between 11–18m have enhanced evacuation requirements but don't need a second staircase.
Part M — Accessibility
Many local authorities are requiring a proportion of new homes to be built to Part M4(2) standards (accessible and adaptable dwellings) or M4(3) (wheelchair-user dwellings). This affects unit layouts and adds £1,000–£5,000 per unit depending on the standard applied. London Plan requires 90% M4(2) and 10% M4(3).
Part S — EV charging
All new residential buildings must have electric vehicle charge points. For developments with parking, this means EV charging infrastructure for every parking space. For developments without parking, electrical capacity for future installation. Adds £800–£2,000 per charge point.
Sprinkler requirements
Residential buildings over 11m must have sprinkler systems. This applies to purpose-built flats of approximately 4+ storeys. Cost: approximately £1,500–£3,000 per unit.
Cumulative cost impact
Taken together, recent Building Regulations changes add approximately 8–15% to build costs compared to 2020 standards. For a typical new-build apartment scheme at £250,000 per unit build cost, this represents £20,000–£37,500 per unit in additional compliance costs.
This must be reflected in your cost schedule when applying for development finance. Lenders who see costs below current benchmarks will challenge them.
Impact on development finance
Higher build costs mean you need either more equity or higher GDV (or both) to make deals work. The good news is that regulatory-compliant homes are more valuable, more energy-efficient, and more attractive to buyers and mortgage lenders. Present your scheme as compliant with current standards — it demonstrates competence and gives lenders confidence in both the build and the exit.
Submit on Assesr with current-standard cost schedules. The AI credit paper flags regulatory compliance as part of the scheme assessment.