Growth and Prosperity Scrutiny 22/10/15 Growth and Prosperity - - PowerPoint PPT Presentation

Growth and Prosperity Scrutiny 22/10/15 Growth and Prosperity Scrutiny 22/10/15

Sarah Clayton, Head of Housing Strategy and Enabling

Introduction

• What is Affordable Housing?
• What is not affordable housing?
• How much is there in Salford?
• Shared ownership examples
• How does Affordable Housing get delivered?
• How much has been delivered recently?
• What is the national policy direction?
• What is the GM ‘thinking’
• What is next for affordable housing?

What is Affordable Housing ?

• Affordable housing is social rented, affordable rented

and intermediate housing, provided to eligible households whose needs are not met by the market

• Affordable housing should include provisions to remain
• Affordable housing should include provisions to remain

at an affordable price for future eligible households or for the subsidy to be recycled for alternative affordable housing provision.

• Critically – affordable housing helps the Council meet

it’s responsibility for helping those in housing need.

What is not Affordable Housing ?

• ‘Cheap’ housing – housing at the lower end of the
• wner occupied or private rented sectors.
• Private rented housing / homes for sale that are

developed by Housing Associations. developed by Housing Associations.

• Properties bought through the Governments ‘Help to

Buy’ (enables access to O/O with 5% deposit).

How much is there is Salford ?

• 30% of homes in Salford are affordable.
• GM average is 23%.
• Main Housing Association stock owned by City West

Housing Trust and Salix Homes.

• The council owns 1250 homes in Pendleton.
• The council works with a range of partners to deliver

new homes.

How does shared ownership work?

• 400 existing shared ownership households.
• 25% -75% of equity bought with rent payable on the

remainder.

Examples:

Nightingale Gardens:

• 3 bed house £150,000 starting price, 35% stake

(£53,500), minimum deposit for the purchase is 5% therefore £2,500

• 4 bed house £160,000 starting price, 35% stake
• 4 bed house £160,000 starting price, 35% stake

(£56,000), minimum deposit for the purchase is 5% therefore £2,800 Malkins Wood Lane, Worsley

• 3 bed house £204,950 starting price, 35% stake

(£71,732), rent on remainder £320 per month.

How Does Affordable Housing get delivered ?

• There are two main routes for affordable housing new

development:

• Grant funding from The Homes and Communities
• Agency. Few schemes are non grant schemes.
• Developer contribution for affordable housing through

S106s.

What has been delivered recently ?

• 3000 new affordable homes from 2007 – 20017.
• £3m per year income to the Council from council tax
• £20m New Homes Bonus.
• Salford has a good track record in using it’s land

innovatively with JVs already in place – New Broughton (613); Charlestown (contract) ; Higher Broughton

YEAR NUMBER OF AFFORDABL E HOMES SUPPORTED LIVING TOTAL COST % PRIVATE SECTOR INVESTMENT LEVERED IN JOBS SUPPORTED COUNCIL TAX PA NEW HOMES BONUS 2007/08 270 19 £40,980,679 53% 492 £287,684 2008/09 126 3 £17,745,766 58% 213 £121,828 2009/10 277 3 £28,477,692 41% 342 £301,339 £1,808,035 2010/11 274 3 £37,543,162 38% 451 £295,475 £2,348,248 2011/12 242 1 £41,291,535 63% 495 £307,786 £2,451,517 2012/13 198 £21,396,942 77% 257 £154,989 £1,249,136 2013/14 169 £15,576,155 82% 187 £116,642 £1,010,651 2014/15 575 227 £55,807,068 76% 670 £574,330 £4,697,583 2015/16 194 6 £17,396,887 81% 209 £195,244 £1,577,968 2016/17 617 221 £62,316,384 77% 748 £641,679 £4,318,001 2017/18 151 21 £15,394,518 76% 185 £143,864 £1,173,228 TOTAL 3,093 504 £353,926,787

65%

4,247 £3,140,861 £20,634,366

9,200 p.a. The delivery challenge – Greater Manchester Combined Authority p.a.

Generation Rent to Generation Buy

• Starter Homes (80% of market value, sold by

developers to under 40’s).

• Voluntary Right to Buy for Housing Association homes

(50-70% discount on flats and 35-70% discount on houses to a maximum of £77,900 currently).

• Sale of vacant high value council homes (with £ going

back to central govt, assumed rate by formula).

• Rent reduction (-1% over next 4 years).
• Pay to stay for those with high income in social rented.
• Impact – Housing Associations reducing development

programmes; changing tenure preference; impact on council HRAs

What is next for affordable housing?

• Spending Review – to facilitate o/o ?
• Reduction in HA development programmes, move

towards S/O, outright sale.

• Move towards Starter Homes as developer contribution?
• Councils who had headroom may continue to develop,

but less?

• GM emerging view ?
• Salford Council – use what we’ve got better? direct

development? Business plan and feasibility; In or out of HRA? strong strategic clarity; agree use of land; JV and

• ther options.

• QUESTIONS ?