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Charity calls for s106 changes to ensure more affordable homes

by on July 30, 2015

Viability assessment guidelines should be introduced to make it more difficult for developers to reduce affordable housing in planning agreements, top research charity the Joseph Rowntree Foundation (JRF) has proposed.

It has published a report on planning obligations (s106 agreements) which concluded that recent changes to the planning system have made it more difficult for planning agreements to ensure homes are built for those on the lowest incomes.

The charity argued that the National Planning Policy Framework (NPPF), introduced by the coalition government, has led to negative impacts, including a greater emphasis on viability assessments, giving developers more ability to renegotiate agreements if they can show they make the scheme unworkable.

JRF has made the case for the introduction of viability assessment guidelines, which would set parameters for building costs and land values and allow councils to extract an amount from the rise in land value resulting from the granting of planning permission. The charity stressed this should be the existing use value, not the market value, of land.

It is also calling for the NPPF definition of affordability to be changed so it is aligned with households’ ability to pay.

The report also argued for local mechanisms to supplement S106, This could involve partnerships with local developers, housing banks, cross-authority co-operation to deliver housing and ethical trusts.

In a related but separate development ministers have been recommended to rethink the exemption that allows developments of fewer than 10 units, and empty buildings, to avoid having to contribute towards affordable housing.

The Local Government Association (LGA) is asking for a more flexible system to be introduced so that contributions (i.e. section 106s) can be required from developers of smaller sites if the needs of local communities warrant them.

The change in guidance would allow councils to reflect local market conditions and agree contributions with developers at an early stage, argued the LGA.

View the report

Roger Milne

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