Section 106 and local occupancy clauses: can you let a house with a restriction on who lives there?

Section 106 is the England-and-Wales planning-obligation route, but similar restrictions exist in Scotland under section 75 and in Northern Ireland under section 76. The letting answer is deed-specific: the wording on the title and planning file matters more than the label people use for it.

What is a Section 106 agreement, and is it legally binding?

A Section 106 agreement in England and Wales is a legally binding planning obligation under the Town and Country Planning Act 1990, and GOV.UK states that “Planning obligations run with the land, are legally binding and enforceable.” In practice, Section 106 explained means a deed or unilateral undertaking used to make a development acceptable in planning terms by restricting land use, requiring works, requiring payments, or securing affordable-housing controls. The statute makes a restriction or requirement in a planning obligation “enforceable by injunction,” and it also says a planning obligation is a local land charge, which is why a later buyer can be bound by it. Scotland’s equivalent is a section 75 planning obligation under the Town and Country Planning (Scotland) Act 1997, and Northern Ireland’s equivalent is a section 76 planning agreement under the Planning Act (Northern Ireland) 2011; both can bind successors when the statutory conditions are met.

What is a local occupancy clause?

Scotland's stance on these restrictions changed in December 2025 — Circular 4/2025 revoked Circular 3/2012, which called such restrictions “rarely appropriate”; current guidance only says they have “a limited role.” A local occupancy clause is not a single statutory formula: in England and Wales it is usually a Section 106 local need occupancy clause, planning condition, or title restriction that limits occupation to people with a defined local connection, and Westmorland and Furness describes it as “a restriction that limits who can occupy a new home to people with a local connection.” The local connection test may refer to the parish, district, National Park, employment, family connection, principal residence, income, or affordable-housing eligibility. In Scotland the section 75 route still exists, but older pages quoting the revoked “rarely appropriate” line are stale after Circular 4/2025. In Northern Ireland, comparable planning agreements can also restrict use or occupation, but the wording of the agreement controls the answer.

Can you rent out a Section 106 house?

You can rent out a Section 106 house only if the particular Section 106 agreement, planning condition, section 75 obligation, or section 76 planning agreement allows letting and the tenant meets any occupancy test written into it. There is no UK-wide statutory rule that every Section 106 house cannot be let, but the deed can restrict “the development or use of the land in any specified way,” and that may mean the occupier, not just the owner, must satisfy the local-connection test. A parish local-connection clause normally follows the person living in the property, so buying the house as a qualifying owner does not automatically let you put in an unqualified tenant. The local examples vary sharply: First Homes guidance says “You can let your First Home for a period of up to 2 years” if the conditions are met, while Ceredigion says its discount-for-sale properties “cannot normally be rented out.” In Gwynedd, the council assesses the new applicant when a property is sold or re-let.

Can you get the council's permission to let a Section 106 house?

You can get the council’s permission to let a restricted home only where the deed, condition, statutory scheme, or council process gives a consent route; there is no general TCPA 1990 Section 106 permission-to-let form that overrides the wording. The starting point is the instrument itself, because section 106 allows obligations “restricting the development or use of the land in any specified way,” so one agreement may permit temporary letting with approval while another may ban open-market renting. For a Welsh example, Gwynedd says that when Section 106 properties are sold or re-let, “the Council must assess the new applicant wishing to buy or rent the property to ensure they meet the relevant criteria.” A former council right-to-buy home in a National Park, AONB or designated rural area may instead involve Housing Act 1985 section 157 consent, which is a separate statutory route from a Section 106 deed; Cotswold’s published re-let process is an example of that different regime.

Does a local occupancy clause mean the same thing in every council area?

A local occupancy clause does not mean the same thing in every council area, because no UK statute imposes one national local-connection test for Cumbria, the Lake District, North Yorkshire, South Lakeland, Gwynedd, Scotland, or Northern Ireland. The Commons Library describes the English planning practice as local planning authorities requiring developers “to only sell/rent new housing to people who have a local connection or who reside in the local area,” but each council’s wording can define that connection differently. Gwynedd says “The level of discount and the local connection conditions may vary from property to property,” which is the safest assumption for any S106 local occupancy restriction. The Peak District’s strong local connection test is far tighter than many casual summaries: it means someone has lived in the relevant parish, or an adjoining National Park parish, for “at least 10 years” in the last 20. Lake District policy may also add a main-residence requirement.

Can a Section 106 or local occupancy clause be removed?

A Section 106 or local occupancy clause can be removed or changed only by the proper planning-obligation route: agreement with the authority, or a statutory modification/discharge application once the waiting rule for that nation is satisfied. In England and Wales, section 106A says a planning obligation may not be modified or discharged except by the statutory routes, and the default unilateral application wait is five years from the obligation date unless a shorter period is prescribed; the 2013 shorter-period regulations are England-only and “do not affect the operation of the 1992 Regulations in relation to Wales.” Scotland is different: section 75A now allows a bound person to apply to modify or discharge a planning obligation, and the former statutory waiting subsection has been repealed, so there is no statutory wait in the remaining text. Northern Ireland has a five-year default wait under section 77. Voluntary renegotiation is different: GOV.UK says planning obligations “can be renegotiated at any point” where both sides want to do so.

What happens to a Section 106 restriction when you sell the house?

A Section 106 restriction normally stays with the house when you sell it, because in England and Wales the obligation can be enforced “against any person deriving title from” the original landowner. Sale may release the seller personally for periods after they no longer own the land if the deed says so, but the sale itself does not wipe the local land charge or affordable-housing restriction off the title. Scotland reaches the same practical result through section 75 where the obligation is recorded in the Register of Sasines or registered in the Land Register of Scotland, unless the instrument says only the original party is bound. Northern Ireland’s section 76 planning agreement is also enforceable against successors in title. For a Section 106 Cornwall house for sale, or any other restricted resale, the conveyancing point is therefore disclosure and compliance: the buyer must be eligible if the restriction requires it, and any discount or occupancy restriction may continue on each transfer.

Where can you get a copy of your Section 106 agreement?

You can get a copy of your Section 106 agreement from the local planning authority’s planning register or local land charges records, and in Northern Ireland a person bound by the agreement can require the authority to provide a free copy. In England, the development-management rules require the planning register to hold “a copy (which may be photographic or in electronic form) of any planning obligation or section 278 agreement” entered into with the decision. Wales has a similar planning-register duty for planning obligations proposed or entered into in connection with the application. If the document is not held by HM Land Registry, GOV.UK’s local land charges guidance says that if you need a copy of a charge document, “you will need to contact the originating authority.” There is no national England-and-Wales fee for a spare copy: some councils provide documents online, while Reading’s published fee list charges £29 per document.

What is Section 106 affordable housing?

Section 106 affordable housing is affordable housing secured through a planning obligation, usually by requiring homes on a development to be sold or let only on specified affordable terms and to remain restricted for future owners or occupiers. The National Planning Policy Framework defines a planning obligation as “A legal agreement entered into under section 106 of the Town and Country Planning Act 1990 to mitigate the impacts of a development proposal,” while affordable housing is “Housing for sale or rent, for those whose needs are not met by the market.” The exact product may be social rent, affordable rent, First Homes, discounted market sale, shared ownership, or another policy-compliant tenure. In England, discounted market sale housing is at least 20% below local market value, and First Homes must be sold at least 30% below open-market value. The current MHCLG figure is that nil-grant Section 106 delivered 36% of England’s affordable homes in 2024-25, down from 45% the year before.

Last reviewed September 2026.

Sources

• GOV.UK planning obligations guidance — “Planning obligations run with the land, are legally binding and enforceable.” Source
• Town and Country Planning Act 1990 s.106 — “A restriction or requirement imposed under a planning obligation is enforceable by injunction.” Source
• Town and Country Planning Act 1990 s.106 — “A planning obligation shall be a local land charge and for the purposes of the M1Local Land Charges Act 1975 the authority by whom the obligation is enforceable shall be treated as the originating authority as respects such a charge.” Source
• Town and Country Planning (Scotland) Act 1997 s.75 — “A relevant instrument to which the owner of the land is party may be recorded in the Register of Sasines or, as the case may be, registered in the Land Register of Scotland; and if the instrument is so recorded or registered then the planning obligation is (unless the instrument provides that only the person entering into that obligation is to be bound by it) enforceable at the instance of the planning authority—” Source
• Planning Act (Northern Ireland) 2011 s.76 — “A restriction or requirement imposed under a planning agreement is enforceable by injunction.” Source
• Scottish Government Circular 4/2025 — “This Circular revokes and replaces Circular 3/2012, which was last updated in November 2020.” Source
• Scottish Government Circular 3/2012 — “Imposing restrictions on use are rarely appropriate and so should generally be avoided.” Source
• Scottish Government planning obligations guidance — “While the most common use of planning obligations is to ensure the provision of infrastructure to make a development acceptable in planning terms, there is a limited role for obligations in restricting the use of land or buildings.” Source
• Westmorland and Furness Council local occupancy guidance — “A local occupancy clause in a Section 106 agreement is a restriction that limits who can occupy a new home to people with a local connection.” Source
• National Planning Policy Framework glossary — “Rural exception sites seek to address the needs of the local community by accommodating households who are either current residents or have an existing family or employment connection.” Source
• Town and Country Planning Act 1990 s.106 — “(a)restricting the development or use of the land in any specified way;” Source
• First Homes customer guide — “You can let your First Home for a period of up to 2 years provided you notify the relevant local authority, and subject to the terms of your mortgage agreement.” Source
• Ceredigion County Council discount-for-sale guidance — “These properties cannot normally be rented out.” Source
• Cyngor Gwynedd Section 106 assessments — “When these properties are sold or re-let, the Council must assess the new applicant wishing to buy or rent the property to ensure they meet the relevant criteria.” Source
• Housing Act 1985 s.157 — “(b)there will be no disposal by way of tenancy or licence without the written consent of the landlord unless the disposal is to a person satisfying that condition or by a person whose only or principal home is and, throughout the duration of the tenancy or licence, remains the dwelling-house].” Source
• Cotswold District Council former council property guidance — “This means you may need to apply to us for consent to alter, sell or re-let your property.” Source
• Commons Library local housing restriction briefing — “Some local planning authorities (LPAs) require developers to only sell/rent new housing to people who have a local connection or who reside in the local area.” Source
• Cyngor Gwynedd Section 106 assessments — “The level of discount and the local connection conditions may vary from property to property.” Source
• Peak District National Park self-build guidance — “For the purposes of this Development Plan, ‘strong local connection’ means a person has lived in the particular Parish of a Core Strategy policy DS1 settlement (see Appendix 3) where a house is located or proposed to be located (or in an adjoining Parish within the National Park) for a period of at least 10 years (not necessarily continuous) in the last 20 years.” Source
• Lake District National Park Housing SPD — “It will also be restricted to be the person’s main residence in all cases.” Source
• Town and Country Planning Act 1990 s.106A — “(1)A planning obligation may not be modified or discharged except—” Source
• Town and Country Planning Act 1990 s.106A — “(b)if no period is prescribed, the period of five years beginning with the date on which the obligation is entered into.” Source
• Town and Country Planning (Scotland) Act 1997 s.75A — a person against whom a planning obligation is enforceable may apply to the planning authority to have the obligation modified or discharged Source
• Planning Act (Northern Ireland) 2011 s.77 — “(b)if no period is prescribed, the period of 5 years beginning with the date on which the agreement is entered into.” Source
• Town and Country Planning (Modification and Discharge of Planning Obligations) Regulations 2013 — “These Regulations do not affect the operation of the 1992 Regulations in relation to Wales.” Source
• GOV.UK planning obligations guidance — “Planning obligations can be renegotiated at any point, where the local planning authority and developer wish to do so.” Source
• Town and Country Planning Act 1990 s.106 — “(b)against any person deriving title from that person.” Source
• Town and Country Planning Act 1990 s.106 — “The instrument by which a planning obligation is entered into may provide that a person shall not be bound by the obligation in respect of any period during which he no longer has an interest in the land.” Source
• Planning Act (Northern Ireland) 2011 s.76 — “(b)against any person deriving title from that person.” Source
• Town and Country Planning (Development Management Procedure) (England) Order 2015 art.40 — “(f)a copy (which may be photographic or in electronic form) of any planning obligation or section 278 agreement entered into in connection with any decision of the local planning authority or the Secretary of State in respect of the application;” Source
• Town and Country Planning (Development Management Procedure) (Wales) Order 2012 art.29 — “(b)a copy (which may be photographic or in electronic form) of any planning obligation or section 278 agreement proposed or entered into in connection with the application;” Source
• HM Land Registry Practice Guide 79 — “If you require a copy of a document relating to a charge (other than a document kept by HM Land Registry; see section 6), you will need to contact the originating authority.” Source
• Planning Act (Northern Ireland) 2011 s.76 — “If a person against whom an agreement is enforceable requests the relevant authority to supply that person with a copy of the agreement, it is the duty of the authority to do so free of charge.” Source
• Reading Borough Council land charges register — “There is a standard charge of £29.00 per document which can be paid using the online local land search form.” Source
• National Planning Policy Framework glossary — “Planning obligation: A legal agreement entered into under section 106 of the Town and Country Planning Act 1990 to mitigate the impacts of a development proposal.” Source
• National Planning Policy Framework glossary — “Housing for sale or rent, for those whose needs are not met by the market (including housing that provides a subsidised route to home ownership and/or is for essential local workers); and which complies with one or more of the following definitions:” Source
• National Planning Policy Framework glossary — “(c) Discounted market sales housing: is that sold at a discount of at least 20% below local market value.” Source
• First Homes guidance — “In order to qualify as a First Home, a property must be sold at least 30% below the open market value.” Source
• GOV.UK planning obligations guidance — “Planning obligations for affordable housing should only be sought for residential developments that are major developments.” Source
• Welsh Government affordable housing provision release — “The land itself, rather than the person or organisation that develops the land, is bound by a Section 106 Agreement, so this is something any future owners will need to take into account.” Source
• MHCLG affordable housing supply in England 2024 to 2025 — “Delivery of affordable homes funded through s106 nil grant agreements with developers (completions for which no government grant funding is provided) accounted for 36% of all affordable homes delivered in 2024-25, compared to 45% in the previous year.” Source