BNG policy quietly changed before Christmas. If you’re building homes in 2026, it will affect you

A significant change to biodiversity net gain (BNG) policy slipped through just before the end of last year, with little fanfare. On 16 December, ministers confirmed new rules expanding exemptions for smaller housing sites, as part of a wider push to “get Britain building again”.

For anyone involved in delivering homes – developers, landowners, planners, funders or local authorities – this is not a minor tweak. These changes are already influencing viability, delivery timelines and risk in 2026, at a point when the BNG system itself remains unsettled.

BNG has been mandatory for less than two years, but it has already reshaped the development landscape. For the first time, biodiversity loss has a defined cost, and developers must account for it either through on-site delivery or by securing off-site units from habitat banks. Over the past 18 months, the sector has been learning how to work with this new reality: how to price BNG into land deals, how to programme it into schemes, and how to navigate planning with more certainty.

That growing confidence is important, because BNG is no longer just a policy requirement; it is a functioning market. And markets are sensitive to signals.

By increasing exemptions for smaller sites, the government is seeking to remove friction from parts of the housing system. For some developments, particularly at the smaller end, that may offer short-term relief. But interventions like this do not operate in isolation. Reducing participation in one part of the market inevitably affects behaviour elsewhere, and the consequences are already becoming visible.

At Greenshank, we work with developers, landowners and local authorities across the country to deliver BNG and nutrient mitigation schemes in practice, not just on paper. We are seeing developers pause decisions on off-site BNG solutions, uncertain whether further policy changes might follow. Landowners considering habitat banks are questioning whether it still makes sense to commit land and capital to a market that appears politically fluid. At the same time, local planning authorities are beginning to explore how they might reassert local delivery through policy wording or guidance, adding variation and uncertainty back into the system.

The core issue here is not cost; it is uncertainty. Costs can be modelled and negotiated. Clear obligations can be programmed into development timelines. But moving goalposts are much harder to manage. When nature requirements feel provisional, they become more difficult to price into land values, harder to finance, and more contentious at planning committee. That uncertainty slows delivery, which is precisely what these reforms are meant to avoid.

There is also a risk of knock-on effects within the BNG market itself. Reduced demand from exempt sites may suppress prices for some common habitat types, while making more constrained or specialist units scarcer and more expensive. That kind of volatility increases the likelihood of late-stage surprises for schemes that assumed BNG was already resolved, undermining confidence further.

None of this is an argument against housing delivery, nor is it an argument against BNG. When it works well, BNG can support development by providing clear routes through planning and flexible options for compliance. But for that to happen, it needs stability as much as flexibility.

As the sector looks ahead to 2026, the December changes should not be dismissed as a minor adjustment made in the run-up to Christmas. They are a signal about how nature policy may be treated when delivery pressure mounts. The challenge now is ensuring that short-term interventions do not undermine the long-term credibility of a system that is still maturing.

BNG is here to stay. Whether it becomes a reliable part of the development toolkit, or another source of risk and delay, will depend on whether confidence and consistency can be restored quickly enough.

Kim Connor-Streich is CCO of Greenshank Environmental