Thursday, 9 November 2017

Developers 'forcing' local councils to allow more housing... as long as its not affordable housing

'Development' is, as always, the rage, but exactly who is it meant to benefit?

The latest examples:


Despite the failure of the proposed extension to the Princesshay shopping centre...
Exeter's 'double whammy' as leisure centre and bus station also put on hold - Devon Live
Pete’s pool in Exeter, Paul’s folly in Honiton? | East Devon Watch
Futures Forum: The District Council's reputation on planning is described as 'an absolute disaster area'
... the officer behind the Princesshay development has just received a gong:
Exeter City Council chief executive Karime Hassan named a 2017 'Face of Growth' - Devon Live
Ex-EDDC regeneration officer and Exeter City Council CEO gets award | East Devon Watch
... even whilst the 'growth' is not exactly an open book:
Futures Forum: The picture of 'devolution' in the South West gets murkier
Futures Forum: Greater Exeter and excluding citizens from 'a strategy for inclusive growth'


Meanwhile, developer Persimmon - who own a large 'land bank' in the Sid Valley...
Futures Forum: Persimmon, Sidmouth and "promoting well-designed housing that is sustainable and provides much-needed new housing..."

... would like the authorities to allow a little more 'growth':
You can’t make it up: Persimmon wants more government help for developers! | East Devon Watch

As stated in today's Telegraph, the builder would like to increase efforts to 'force' local authorities to allow more building:

Persimmon urges Government to take action on the planning system to encourage building

Rhiannon Bury 9 NOVEMBER 2017 • 12:01AM

Housebuilder Persimmon has urged the Government to push ahead with simplifying the planning system as its order book for new homes continues to rise. The company said in a trading update on Wednesday that, despite efforts to force local councils to identify sites for housing, “achieving detailed planning consent for the land identified is proving as challenging as ever”.

Jeff Fairburn, chief executive of Persimmon, said: “A lot of good work has been done on the planning system but more progress needs to be made and that would hopefully be of benefit to the whole of the UK economy.”

Persimmon said on Wednesday that trading in the past four months had been driven by attractive mortgage rates and the Government’s Help to Buy scheme. It reported that it has around £909m of forward sales reserved beyond 2017, an increase of 10pc on the same point last year.

Shares in the firm closed down 3.5pc at £27.72, although the companyremains one of the best performing stocks on the index. During the period, Persimmon acquired a total of 5,526 new plots costing it £147m.

Persimmon urges Government to take action on the planning system to encourage building - Telegraph


Finally, back in January this year, another house-builder was embarking on the first stage of an estate just outside Gittisham, near Honiton - proclaiming how generous it was being with its (statutory) CIL/S 106 money:

The 100 homes built on the land west of Hayne Lane is phase one of the development to build around 300 homes and will see a quarter of the homes built be affordable.

A spokesperson for Baker Estates said: “The development will bring a number of positive benefits to the community in Honiton and the wider area.

“On the first phase of the development, we will be providing around 24 affordable homes, with a range of sizes and tenures.

“The development of the homes will also create construction job opportunities for local people. Baker Estates has committed to using local sub-contractors and suppliers wherever possible, which will be a boost to the local economy.

“In line with the outline application’s Section 106 agreement, we will also make financial contributions of £2,840 per home towards the cost of providing or enhancing primary education facilities. We will also commit £488,328 to be used for provision or enhancement of public open spaces in the vicinity of the development. This is in addition to £100,000 for providing play equipment to local open space. We have also committed £150,000 for road improvements for the Turk’s Head junction which has since been completed.”

Plans for 100 new homes between Honiton and Gittisham - View News

The trouble is that the developer would now like to reduce that number of affordable homes - and the local authorities seem to be delighted:

At a meeting on Tuesday, Baker Estates’ technical director Graham Hutton said: “The reason we have come up with the proposed section 106 package that we have is that we have understood what the desires of Gittisham and Honiton are.

“We have tried to come up with a package which is better – under the current scheme nobody seems to get what they want.”

Mr Hutton said the 40 per cent affordable housing does not seem to be the top priority of either Honiton Town Council or Gittisham Parish Council.

Cllr John Zarczynski said the ‘vibrations’ he was getting from East Devon District Council meant he was ‘wobbling’ on whether Honiton would receive the money. He added: “What you are proposing is very generous, but I just feel at the moment there is nothing concrete that we will actually see the money.”

Baker Homes Hayne Lane development latest - Honiton, Axminster and Seaton news - Midweek Herald

The EDW blog would call this offer a 'bribe':


8 NOV 2017

The development: 300 homes in beautiful Gittisham, home of the latest very posh and very popular “Pig at ..” hotel chain.

The bribe: £400,000

The catch: Allow Baker Homes to cut their “affordable” properties from 120 to 90.

So, for the likely cost of ONE of their new homes, let them build 29 more of them and see 30 families lose out on cheaper (but not cheap) homes.

Let’s say each new home cosy a very conservative £300,000 x in fact the average cost is likely to be MUCH more than that. Affordable homes would have cost £240,000 (a 20% discount).

120 homes sold at £240,000 = £28,800,000
180 homes sold at £300,000 = £54,000,000
Total income from sales: £88,800,000


90 homes sold at £240,000 = £21,600,000
210 homes sold at £300,000 = £63,000,000
Total sales = £74,600,000
Less £400,000 paid to council
Total income from sales = £74,200,000

Total increase in sales = £14,400,000

and all for an outlay of £400,000

If the houses DO cost even more the profit will be even higher.

So, what’s it to be Honiton? A bit of cash or 30 families done out of homes they MIGHT be able to afford – at a pinch?

Developer offers small bribe to avoid building affordable homes which would increase profits by millions | East Devon Watch

The relationship between developers, local planning authorities and CIL/S 106 payments is fraught, to say the least:
Futures Forum: The District Council and not bothering about its S106 cash
Futures Forum: S106 Management - or how developers avoid affordable housing
Futures Forum: Missing out on developers' S106 funds...
Futures Forum: 106 payments and the NPPF... the repercussions for East Devon

“Knowle relocation project: full Pegasus contract published” | East Devon Watch
Futures Forum: Knowle relocation project: full Pegasus contract published

Revealed: reasons for Sidford business park refusal - Sidmouth and Ottery breaking news and sport - Sidmouth Herald
Futures Forum: BREAKING NEWS >>> Sidford business park > Fords planning application >>> 16/0669/MOUT >>> REFUSED

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