Landlords reluctant to commit to S106 homes, warn housebuilders

Published by 24publishing for 24dash.com in Housing and also in Communities, Local Government

Housing associations are increasingly reluctant to commit to S106 purchases as a result of uncertainty around future grant funding post-2015, the Home Builders Federation (HBF) has warned.

The warning was made in the HBF’s Autumn Statement submission to chancellor George Osborne ahead of his speech next week.

The HBF said: “They are increasingly reluctant to commit to S106 purchases, so that home builders find themselves with very limited demand for these units.

“This will have an increasingly adverse impact on vendors’ willingness to release land as house builders are unable to forecast Affordable Housing (AH) obligations and revenues. It is already having an impact on AH negotiations with local authorities for schemes delivering post 2015 and on housing supply from longer-term housing schemes and land investments.”

It says the affordable homes programme could be accelerated if the HCA exercised “much greater flexibility”.

On its wish list includes calls to expand the definition of affordable housing. It says the current definition in the National Planning Policy Framework “is very narrow”.

It said if the definition were expanded, for example to allow shared-equity, discounted market sale, and possibly some forms of private rented housing, the private and regulated sectors would be able to provide many more homes than under the current definition.

The HBF submission said: “A broader definition would allow companies to meet a larger spread of the intermediate market and offer individual buyers choice from a range of solutions.

“There has been an enormous growth in the number of prospective purchasers of intermediate housing products, households which are not prioritised for subsidised housing but are also unable to access full home ownership at market prices. These households are economically active but their housing aspirations and choices are being denied.”

An expansion of the definition, it argues, would also increase innovation improve site viabilities and profitability and allow home builders to increase their output.