A new planning model has been introduced in Westminster, helping to balance the books for development companies and make affordable housing viable even in high value areas.<\/p>\n
Under this new model, the landowner agrees to sell the land at under the market value in return for credit which can be used against payments that might have to be made in projects where affordable housing isn\u00e2\u20ac\u2122t viable.<\/p>\n
In the landmark Westminster case, commercial property company Land Securities sold a site to private affordable property developer \u00e2\u20ac\u02dcPocket\u00e2\u20ac\u2122 for \u00c2\u00a32.3m less than market value. This allowed Pocket to create the homes at 20% less than market value, despite the fact that the expensive nature of the central London area meant none of the usual savings could be made.<\/p>\n
The result was a 32 home development on Fermoy Road, Westminster, providing one bedroom flats at affordable prices to households that meet the income criteria used for the mayor of London\u00e2\u20ac\u2122s first-time buyer scheme (those earning less than \u00c2\u00a361,400 a year).<\/p>\n
Buyers are also tied by a covenant on the properties, ensuring that further sales are at a 20% discount on the market rate and to a household that qualifies for affordable housing, with the prior approval of the council.<\/p>\n
For \u00c2\u00a0Land Securities, this also meant \u00c2\u00a32.3 million in credit to offset planning obligations on other developments.<\/p>\n
Marc Vlessing, co-founder of Pocket, is reported to have said the scheme could be a \u00e2\u20ac\u02dcmassively important\u00e2\u20ac\u2122 way of funding affordable housing developments in high-value areas.<\/p>\n
He commented: \u00e2\u20ac\u0153We are talking to Hammersmith & Fulham, Kensington & Chelsea \u00e2\u20ac\u201c talking to a number of lead boroughs \u00e2\u20ac\u201c Camden \u00e2\u20ac\u201c in which there are large developers with big affordable housing obligations, and where our credit model creates a new currency.\u00e2\u20ac\u009d<\/p>\n
Philippa Roe, leader of Westminster Council, said: \u00e2\u20ac\u02dcThis new scheme lays the foundations of a new era in affordable housing in the capital.\u00e2\u20ac\u2122<\/p>\n
Thus the scheme could provide an important benchmark for other London Boroughs, where affordable housing projects are extremely rare, to ensure that lower income households can make that important first step onto the property ladder into good quality accommodation.<\/p>\n","protected":false},"excerpt":{"rendered":"