Housing Minister Yvette Cooper announced a new scheme that will let councils offer thousands of affordable housing deals to help key workers and first time buyers onto the property ladder. This marks a return of the local authority to the centre stage in providing homes for communities but in a new way - through Local Housing Companies (LHCs).
Councils will be able to offer their own deals for key workers and first time buyers through new homes built on their land. Thousands more young families could get a step onto the housing ladder as a result if councils take up this option.
New guidance for establishing LHCs was published for the first 14 local authorities who have expressed interested in the scheme.
Local Housing Companies are a new radical partnership between councils and the private sector being tested as one of a range of models to help local authorities to bring forward land for housing development, in particular to help increase the supply of affordable housing.
Currently - once local authorities sell off surplus land to the private sector, they have limited influence over how it is developed, or the type and quality of housing provided. The new Local Housing Companies could put the destiny of that land back into the hands of councils, enabling them to double affordable housing levels to at least 50% on sites, and directly offer key workers and first time buyers shared equity deals.
Under the proposals to be piloted, councils would provide their surplus public sector land to the Local Housing Company. The local authority would play a full part in agreeing the development plan, including being able to directly offer low cost housing deals to meet local needs.
In return for taking the land cost out of the equation, private sector partners such as housing builders, including the registered social landlord sector, would provide equivalent investment and the construction expertise needed to build the homes.
Local authorities could also benefit from the increasing value of land on the site that could be ploughed back into providing more affordable homes.
Each Local Housing Company could have the potential to deliver up to 1,000 new homes. They are a key part of the Government's Housing Green Paper to meet the Prime Minister's target to provide three million more homes by 2020.
Notes
English Partnerships issued guidance to the 14 local authorities who have expressed an interest in the scheme. These are Leeds, Sheffield, Nottingham, Newcastle, Wakefield, Sunderland, Dacorum, Harlow, Peterborough, Bristol, Plymouth, Wolverhampton, Manchester and Barking and Dagenham.
Each LHC would act as the master developer within a designated area and will work with other investors and contractors. They will develop new mixed communities and will be able to include at least 50% affordable housing, for key workers and first time buyers.
The £20 million that could be raised from the rating of empty properties should be set aside for affordable housing, according to the Chartered Institute of Housing (CIH) Northern Ireland.
The CIH welcomed the statement by the Minister for Finance and Personnel, Peter Robinson, to the Northern Ireland Assembly, which set out his intention to introduce a 100% rate on empty homes from April 2009. However, the CIH called for monies raised from the measure to be set aside for affordable housing, to help realise the Governments policy objectives and alleviate the housing crisis.
The recent Review into Affordable Housing in Northern Ireland recognised the need to reduce the number of empty properties, and recommended that the ratings system be used to incentivise action to bring properties back into use.
With a disproportionately high level of empty homes in Northern Ireland, the CIH believes that the measure, if implemented swiftly and efficiently, could help make more homes available at a time when they are urgently needed.
Director of the CIH Northern Ireland, Grainia Long, said:
"The Executive has rightly recognised the urgent need for more affordable housing, given the rising waiting lists, and high levels of homelessness in Northern Ireland.
"The decision to rate empty homes is an opportunity for the government to put its money where its mouth is, and add much needed resources to build new homes. I hope the Minister will commit the 20 million to build new social housing, in order to meet Executive commitments on housing."
