Tuesday, 28 March 2017

Landlords fear reviewing section 106 will cripple affordable housing supply

Planning rule change to unlock stalled sites

Fears are mounting that the planning system will struggle to deliver affordable housing as the government this week proposed allowing developers to tear up planning agreements.

On Monday, the government published plans to make it easier for section 106 deals to be renegotiated to help restart stalled sites, and acknowledged that contributions to affordable housing would be the first casualty.

The Communities and Local Government department maintained that it would deliver more affordable homes in the long term.

The move comes when councils across the country are setting their levels of community infrastructure levy - with some reducing their affordable housing requirements because high levels of subsidised housing are unviable (Inside Housing, 10 August).

Obligations on developers to build affordable housing are also likely to be eroded further if the government accepts the recommendations of the long-awaited Montague Review, which will encourage councils to amend their housing strategies to promote private rented housing in place of affordable housing.

Landlords and housing bodies expressed concern about the planning system’s ability to produce affordable homes.

Keith Exford, chief executive of Affinity Sutton, said that up to half of the affordable homes the organisation has historically built has relied upon section 106 deals.

‘I think what all this seems to suggest is that the government has a reduced enthusiasm for affordable housing.’

Currently, section 106 deals can only be renegotiated after five years, but the new rules would allow any agreed before April 2010 to be looked at again. The agreements are intended for developers to ensure they deliver community benefits, infrastructure and affordable housing alongside housing for market sale.

Gavin Smart, director of policy and practice at the Chartered Institute of Housing, said: ‘You can see that at the margins this might bring schemes back into viability, but what the government needs to guard against is the damage the policy might do to affordable housing in high-value areas.’

Pippa Read, policy leader at the National Housing Federation, said: ‘While unlocking stalled sites is important we need to look at the reasons why these sites have stalled and wherever possible not jeopardise the delivery of affordable homes or the provision of well-planned developments.’

Roger Humber, strategic policy advisor to the House Builders Association, said planners had raised concerns about whether ministers were doing enough to boost affordable house building at a meeting with the Homes and Communities Agency at a meeting about progress of its £570 million get Britain building fund on Wednesday.

In a separate announcement on Monday, communities secretary Eric Pickles announced that he was sending ‘expert brokers’ into 10 local authorities to provide mediation between council officers and developers.

Section 106: in numbers

£18.5 billion
value of section 106 deals between 2003 and 2008

25,000
approximate number of affordable homes built each year in England under section 106 agreements

1,400
number of housing schemes with planning permission which are stalled

75,534
number of homes with planning permission which are stalled

£570 million
value of the get Britain building fund

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