A plan for increasing outputs of affordable/social housing.
The Strategic Lead – Housing, Health and Environment presented a conclusions report which pulled together the work of the TaFF and made a series of suggestions for its primary objective of delivering an increase in the supply of new affordable and social housing. Having explored a variety of housing delivery options it was recognised that there was no single model and adopting a range of delivery vehicles would mostly likely achieve the ambition of a ‘step change’ in the output of affordable/social housing.
It was acknowledged that increasing outputs of affordable/social housing required considerable commitment, investment, resources, skills and opportunities. The provision of affordable housing was costly and social housing even more so. Developing and sustaining a pipeline of new build housing schemes would require a dedicated task force or project team with a range of skill sets to give the best chance of achieving the stated ambitions. It would require a risk appetite and a financial model that demonstrates that programmes were financially viable over the long-term.
It was noted that the Council currently produced 200-300 new affordable homes per year. The Housing Revenue Account (HRA) contribution to this output was 20-30 homes per annum. The need for housing undoubtedly existed, with demand outstripping supply and an increase in the housing register and homelessness. However, there were competing pressures on the HRA from decarbonisation and modernisation projects, tenant safety and property repairs.
The TaFF had learnt the following points:
· Vision - what was to be achieved needed to be supported by a strategy and business model.
· Ambition – political ambition and clear community support.
· Investment – schemes were often not financially viable and large investment was required.
· Capacity & resources – these needed to be sufficient to deliver the ambition.
· Opportunities – for example land availability and preferred partner status.
· Risk appetite – this needed to increase.
· Sustained focus – maintain the drive for delivery of housing to be a priority.
· Create a pipeline of opportunity.
The TaFF had discovered that there was a variety of delivery methods for increasing the output of affordable/social housing and that there was no ‘one size fits all’. Considerable resources and finance would be required, with a dedicated team to focus on and ensure delivery. It was advantageous to work in partnership. There was an opportunity in preparing the Local Plan to ensure that the adopted policy supported and optimised the opportunities for affordable housing delivery. There were significant capital and revenue implications and a fully costed appraisal had not yet been undertaken.
The Strategic Lead – Housing, Health and Environment’s report concluded that in order to achieve the TaFF’s ambitions of a ‘step change’ in output of new social/affordable housing the Council needed to adopt all or some of the following recommendations:
Ø Creation of a social housing task force through a combination of new appointments and secondments into a dedicated, single purpose, multi-disciplinary team managed within the Housing Service;
Ø Confirm increased output of social/affordable housing as a Council Plan priority;
Ø Establish a member Social Housing Delivery Group to support and oversee the delivery of social/affordable housing;
Ø Implement the range of delivery options contained in the report to the December 2020 TaFF;
Ø Recruit additional Enabling Officers to work in the social housing task force to support Registered Providers; Community Land Trusts and the Council deliver more social/affordable housing;
Ø Recruit a project manager to build up a programme of development projects and manage the specialist professions input required to deliver social/affordable housing projects;
Ø Identify and create secondment opportunities within the Council;
Ø Source support from an Registered Provider partner with a strong track record in development to help us ‘kick start’ a development programme;
Ø Establish a pipeline of development opportunities to form a programme of sites/schemes;
Ø Undertake an audit of corporate sites and identify any suitable for housing development;
Ø Operate a site finding, feasibility and viability process with a view to land banking sites that contribute to the pipeline;
Ø Promote the Council as preferred developer through the planning system;
Ø Align Planning Policy with affordable housing ambitions to optimise output of social/affordable housing;
Ø We need to consider our risk appetite and produce a risk register that allows us to make calculated development risks;
Ø Utilise the HRA development fund and develop funding models that enable us to sustain a pipeline of social/affordable housing development;
Ø Produce a fully costed project appraisal document for the task force/project team.
During further discussions the TaFF were asked to consider the following points:
1. What is the objective?
a. To own and develop a housing asset
b. To make a surplus/profit
c. To cover costs
d. To deliver appropriate housing for social or affordable rent
e. To deliver shared ownership housing
f. To manage rental housing owned by others
g. To be a model landlord in price and quality
2. Where is the site coming from?
a. Existing HRA
b. Existing EDDC
c. Market price site
d. Exception site
e. Affordable element of commercial development
3. What size and projects and what demand?
a. Urban 50 or more 20 or more 10 or more
b. Rural up to 6 to 15
c. Rural infill less than 6 but requested by community
4. Delivery method?
a. We are developer, employing architects, PM and contractor
b. We are developer with inhouse design and or PM and contractor
c. We work with developer, but developer undertakes all build functions
d. We support community build
a. Provide all development capital
b. Provide site as a share of development capital
c. Provide no development capital but agree to purchase complete units
d. Grant support
e. PWLB loans
f. Cross subsidise from market sales
g. Shared equity sale income
h. Long term loan serviced by rental income
6. What structure in EDDC?
a. Part of HRA/Housing with officers totally or partially assigned
b. Within wholly owned company with officer support or secondment
c. Within wholly owned company with commercially targeted/incentivised management
It was suggested that EDDC should be the enabler/support rather than the direct implementer in order to progress initial development. The focus should be on providing social housing, but to deliver that other types of housing should not be precluded. It was important to deliver the type of housing to make the scheme viable.
RECOMMENDED: that the Housing TaFF recommend to Cabinet and Council the recommendations set out in section 4 of the report, with the following addendums:
1. Identify EDDC or market sites or existing developer led sites.
2. Develop agreements with developers for them to develop and make profit with EDDC having a portion of market and/or affordable/social houses to reflect the Council’s contribution to the development. This will enable us to identify skills, models and opportunities.
3. Concurrent with 1. Identify communities that need support to develop a community-led housing scheme by offering technical and financial support.
4. In the meantime develop flexible models to get proof of concept.