The requirement to contribute to local affordable housing used to be targeted at big developers. No longer, finds our planning expert Sally Tagg
For the first time in the history of Affordable Housing Contributions, self-builders are beginning to see the burden of expectation laid at their door — this at a time when (the entirely separate) Community Infrastructure Levy is beginning to impact on more and more projects, too.
For many years, local affordable housing was predominantly provided for as a planning condition on the provision of larger schemes, e.g. 15 dwellings or more. However in recent years, as the number of houses being built by developers has slowed, fewer affordable dwellings have been built — just at the time in the economic cycle when they are needed more than ever.
In order to address this deficit, some local authorities have implemented – and others are preparing – new planning policies to ensure that sufficient affordable housing can still be provided. As a result, the provision of affordable housing is now often being linked to the creation of one or more market units — meaning that self-builders will increasingly be asked by their local planning authority to provide a financial contribution towards the provision of affordable housing.
Contributions in respect of affordable housing are set in relation to the size of a new property, either in terms of the number of bedrooms or floor space.
The Affordable Housing Contribution recently set by Three Rivers District Council in Hertfordshire in its highest value area would be £187,500 for a 150m² property, and even in its lower value area would total £52,500 for the same-size dwelling, which is still a significant sum — a demonstration that there is a dire need for affordable housing in this district. However, there is no doubt it is also as a result of average house prices being some of the highest outside London.
Even before CIL contributions are taken into account it is clear that self-builders are going to be hit hard by this new approach.
In addition, it should be noted that the new Affordable Housing Contributions will also relate to developments such as barn conversions, as the creation of a new dwelling through this route will still trigger a contribution in most cases.
Affordable Housing Contributions for self-builders are counterproductive — it is a huge additional financial burden on ordinary families trying to build homes for themselves to live in.
Guidance does indicate that if it can be demonstrated that a scheme is unviable with an Affordable Housing Contribution, some or all of the cost can be offset. However, assessments consider costs against market values and as such it is considered that most self-build schemes in this regard would be adjudged to be viable even if the self-builder cannot afford to pay.
Our advice would be to look for plots in areas where burdens like these are less stringent. Identify the costs before you buy a site, enabling you to negotiate with the vendor accordingly.