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  • Refurbish/Develop

    Community transparency about developers



    COMMUNITIES TO SEE HOW HOUSING DEVELOPERS CASH BENEFITS THEM THANKS TO NEW PLANNING RULES

    Local people will be able to see how every pound of property developers’ cash, levied on new buildings, is spent supporting the new homes their community needs, thanks to new rules coming into force today (Sunday 1 September).

    Builders already have to pay up for roads, schools, GP surgeries and parkland needed when local communities expand – in 2016/17 alone they paid a whopping £6 billion towards local infrastructure helping create jobs and growth.

    Yet before today, councils were not required to report on the total amount of funding received – or how it was spent – leaving local residents in the dark.

    New rules will mean councils will be legally required to publish vital deals done with housing developers so residents can see exactly how money will be spent investing in the future of their community.

    Housing Minister Rt Hon Esther McVey MP said:

    “The new rules coming into force today will allow residents to know how developers are contributing to the local community when they build new homes - whether that’s contributing to building a brand-new school, roads or a doctor’s surgery that the area needs.”

    The reformed Community Infrastructure Levy (CIL) rules will help developers get shovels in the ground more quickly, and help the Government meet its ambition to deliver 300,000 extra homes a year by the mid-2020s.

    The rules are designed to support councils and give greater confidence to communities about the benefits new housing can bring to their area.

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    The last era when UK regularly built 300k plus homes annually was the 35 yrs up to 1981 - when half of those homes were Council built.

    In that past era those homes were Govt funded at front end - but tenancy allocation was overwhelmingly to working households who paid rents without claiming benefits - so in combo with annual rent increases the payback period was pretty short - especially so as the land was usually acquired very cheaply by CPO of arable land at arable prices - so un the 1950s an individual land plot was just a tenner - with land at £100 an acre and 10 homes per acre.

    The sustainability of that process was of course kyboshed after the 1977 change to needs-based tenancy allocation of Council housing - hence HB claimants in SRS rose from just 10% in 1980 to 75% today.

    Since early 1990s though Govt capital subsidy for new build social homes was cut from 75% to just 14%.

     

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    Well TV documentaries around Planning process suggest that Planners are now obliged by central Govt to look for reasons to say "yes" whereas in the past the default was often "no".

    All LAs have minimum targets for new builds - though with land at a premium I can see more cramped places being built despite complaints around UK building rabbit hutches!


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    Space standards can now be applied, and are a relevant planning matter. Can be avoided perhaps if there is no up to date local plan and 5 year supply.

    A neighbour trying to convert his bungalow into a row of flats had it rejected on this basis.

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    It is a good move, but maybe only a start.

    Councils love taking developers behind the bike sheds to bend them over quietly.

    Presumbly gung-ho developer blaming Councils will publish them in white ink on white paper.

    I wonder how many purchasers of a newbuild house know that they are paying for the next 25 years of maintenance of all the newly-adopted roads serving their estate, on top of their Council Tax?

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    Yes the S.106/CIL charges obvs means private buyers of new builds are paying a substantial premium - hence higher mortgages and thus less cash to spend in wider economy.

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    Hopefully this will bring about a slight positive change in perceptions. Many local people are ill informed and unaware of what developers have to pay in terms of CIL, S106 affordable housing and other contributions.

    We have two developments going into planning in Waverley Borough at the moment and CIL charges there are now £435/sqm or more depending on location for additional floorspace.

    On the relatively small developments we are doing that's £250,000+ going to the Council for each development. Often local folks complain about how developers don't contribute to the community and the infrastructure can't keep up with it...they don't realise developers have been paying for stuff, in some areas they are paying a lot, but

    Councils appear to have been sitting on funds they pull in. It's right developers should contribute, but it's also right that it should be publicly acknowledged that they are contributing.

    As for the level of CIL in some areas, like Waverley, it's so much now that more development sites will be unviable which further constricts the flow of new homes coming to the market.

    Best,

    Guy
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    Guy Brown
    Blue Infinity Property Group
    M 07791-661491 | T 0118 3360366 | E guy@blueinfinityproperty.com<script data-cfhash='f9e31' type="text/javascript">/* http://www.blueinfinityproperty.com

    * New build residential developments and flat conversions in the Home Counties
    * High end HMOs in Reading and Bracknell