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TOPIC: Enforcing the rules on affordable housing: Enfield council urged to take action

Enforcing the rules on affordable housing: Enfield council urged to take action 18 Aug 2017 17:07 #3168

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[Original article]

homes for londonersA new online petition is calling on Enfield Council to follow guidance issued by the Mayor of London which would ensure that companies building large housing projects would no longer be able to avoid the requirement to provide a minimum of 35 per cent of affordable housing.

38 degrees logo

The petition to Enfield Council

you.38degrees.org.uk/petitions/make-housing-developers-be-transparent-in-enfield

To: Enfield Council

Make housing developers be transparent in Enfield

Follow the guidance set out by the Mayor of London and require developers to make their viability assessments public if they claim they cannot meet at least 35% affordable housing.

Why is this important?

Current planning law states that if a developer won’t make enough profit on a new development, they can ignore a council's regulations about building affordable and social housing.

Leaked documents from several developers have shown that the maths they use to work out their profit margins are purposefully misleading, allowing them to claim they will make less profit than is accurate on a development by undervaluing the prices of the houses they will sell and over-costing the labour.

To combat this Islington, Greenwich, Lambeth and Bristol councils have introduced a policy that forces developers "viability assessments" to be made public.

By bringing these dodgy maths into the public domain, Councils, campaigning groups and individuals will be able to hold developers to account and force them to use more honest maths.

The campaigning group 38 Degrees is encouraging Enfield residents to sign the petition because unless more affordable housing is built in the borough it will be nearly impossible for young people and families to get on the housing ladder.

The Mayor's recently issued supplementary planning guidance on Affordable Housing and Viability provides a way for councils to forestall the common practice of developers to argue that the cost of providing the required amount of less expensive housing would make the entire development "unviable", which in practice is taken to mean that the overall profit from the project would be less than 20 per cent.

Work round rules

The methods by which developers have been able to easily work round rules on the provision of "affordable" housing have been described in some detail in various sources, such as this Guardian article from 2014 and this more recent analysis by the housing charity Shelter. The supplementary guidance document introduces processes and rules that would make it much more difficult to wriggle out of the affordable housing obligation.  Furthermore, Sadiq Khan introduces the more meaningful concept of "genuinely affordable".

The new guidance is long and detailed (though clearly written), but the main features are explained by Dave Hill on his On London blog).  The Mayor hopes that some of the provisions of the new guidance will help reduce the prices paid by developers to buy land because at an earlier stage they will have a more accurate idea of how much they will able to realise from sales and letting. 

Transparency

affordable housing and viability coverThe particular new requirement that the 38 Degrees petition is concerned with is increased transparency -  a requirement for publication of the valuations and costings used to calculate "viability".  Currently, these are regarded as commercially sensitive and are not published, meaning that the public has little or no visibility of the bargaining going on behind closed doors between councils and developers and is thus unable to scrutinise properly and hold local authorities to account.

However, 38 Degrees say that how the new guidance is implemented is up to each borough to determine.  They say that Islington, Greenwich and Lambeth councils are enforcing the requirement for genuine transparency, but so far Enfield is not.

Links

Affordable Housing and Viability Supplementary Planning Guidance 2017 (Mayor of London)

How will Sadiq Khan's 35% affordable housing work? (On London blog, August 2017)

Hhow developers exploit flawed planning system to minimise affordable housing (Guardian June 2015)

The truth about property developers: how they are exploiting planning authorities and ruining our cities (Guardian September 2014)

Developers cannot be allowed to keep breaking their promises on affordable housing (Shelter June 2017)

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Enforcing the rules on affordable housing: Enfield council urged to take action 24 Aug 2017 10:43 #3169


Glad you put "affordable" in quotation marks as it is nonesense, a deliberate misnomer, to cover up the provision of council housing by private developers (sold on to registered providers) since local authorities stopped building their own.

More transparency is good, but there's a lot of hyperbole around this.

Emphasis should be on the provision of private housing, not free housing to council tenants, to satisfy the desperate demand in this area which holds back so many positive knock on effects in the areas it is provided (as opposed to social housing which brings no positives).

But NIMBYs don't want that....because 'affordable housing' actually increases the value of local existing housing stock due to the constraint it applies to new supply......

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