TCPA highlights the new ways councils are boosting affordable housing

By Vivienne Shirley, Senior Consultant

The TCPA has recently published a report exploring the ways councils are trying to boost affordable housing rates in their districts. It comes as social house building hits the lowest proportion of overall housing supply since records began, with only 5,900 homes completed in 2017. At the same time, existing stock has rapidly dwindled thanks to right-to-buy sales and conversions to much higher (not so) affordable rents.

The report follows months of engagement with more than 200 representatives from over 130 councils. Crucially, it finds that some local authorities have developed ambitious Housing Revenue Account (HRA) construction programmes, but have been limited by their HRA borrowing caps. It was hoped that the social housing green paper due to be published before parliament headed off for recess might free councils to build at scale again, but it has failed to materialise.

The paper also finds the new delivery vehicles set up by councils have the potential to meet the need for new homes across a range of tenures, but few are delivering truly affordable social housing – despite this being the most needed type of tenure. Again, lifting the HRA cap and scrapping right-to-buy would do much to help councils meet this critical need.

Another key issue highlighted was the difficulties the current planning system poses for councils, principally the viability test, which is seen by many disgruntled councillors as enabling developers to dodge their affordable housing commitments. These concerns will be assuaged somewhat by the new NPPF, published last week, which states that ‘It is up to the applicant to demonstrate whether particular circumstances justify the need for a viability assessment at the application stage… The weight to be given to a viability assessment is a matter for the decision maker’. This should give more power back to councils when it comes to viability.

The report makes a number of recommendations which the TCPA will hope the government takes into account in the delayed social housing green paper. Principally, it highlights the need for government investment beyond the further £2 billion of funding for affordable housing announced in October, and advises that the Autumn Budget’s proposed lifting of the HRA borrowing cap for some councils should be extended to all authorities with housing stock. It also suggests that councils should be able to retain 100% of their Right to Buy receipts to reinvest into the construction of new affordable housing. We will wait with anticipation to see whether MHCLG takes these very sensible recommendations on board come the autumn.

You can read the full report here.

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