Friday, 22 May 2015

Councils are prioritising lucrative development over affordable housing

No cash left for low-cost homes

Councils are dropping affordable housing targets to prioritise more lucrative types of development, the National Housing Federation has warned.

The NHF has raised concerns ahead of the launch of the government’s new national planning policy framework next month. It says that new provisions for funding development are likely to see affordable housing pushed to the bottom of the list, based on current behaviour.

A qualitative survey of six English councils, carried out by law firm SNR Denton, on behalf of the NHF, showed they either took no account of the need for affordable homes in their area or accepted that levels of affordable homes would be sidelined on sites where other development might be deemed more important.

The community infrastructure levy, which came into force in April 2010, allows councils to charge for new developments and spend the resulting money on local infrastructure, excluding affordable housing.

Cameron Watt, head of neighbourhoods at the NHF, said: ‘Cash-strapped local authorities will want to maximise the CIL to pay for infrastructure, like Crossrail in London. Our real concern is that once a developer has paid its CIL contributions there won’t be any money left over for affordable housing provision.’

A letter from London mayor Boris Johnson to Westminster Council reveals that the residential redevelopment of the former Royal Mail depot at Paddington will prioritise a ticket hall and Crossrail before affordable housing provision in the section 106 deal.

In a second blow for affordable development the Homes and Communities Agency stated landlords will not be able to use new affordable rent grant to fund homes agreed under section 106 deals.

‘Section 106 deals have been incredibly important. Research in 2007/8 from Sheffield University showed that 52 per cent of the total value [of the deals], which was £18.5 billion between 2003 and 2008, was going to affordable housing,’ Mr Watt added.

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