Will First Homes see the end of Shared Ownership?
Numerous unanswered questions in the Planning and Viability sectors leave us questioning what the future of development will look like.
We talk to Andy Leahy, Managing Director at Bespoke Property Consultants, ahead of his guest spot as a Viability Expert at our upcoming 14th Annual Planning & Viability Conference.
The conference will cover developments in viability guidance, the evolution of viability on a practical level, and the challenges the industry is facing in the aftermath of government changes to planning policies.
An industry update
Viability is essential to the successful delivery of developments, not just across the country, but the world.
Understanding development plans to ensure policies are realistic and deliverable is a proven tactic to keep projects on schedule and on budget.
Andy confirms: “In recent times, the government’s changes to planning policies have left the industry unsure of what the future of viability looks like in planning, particularly when it comes to the delivery of affordable housing under the Section 106 agreement.”
The hybridisation of this agreement and CIL has sparked industry-wide confusion over the deliverable aspects of pooled contributions, meaning that each Developer will likely have a different interpretation of the S.106 expectations and that ultimately on some developments they may be missing delivery objectives.
Challenges to viability
In addition to the confusion surrounding planning policy changes, additional fire precautions and cladding investigations have overtaken the delivery of affordable housing plots on numerous sites countrywide as a priority. This highlights several issues to do with future values of affordable housing and hence viability across developments and the ripple effects that this can have on the industry.
Meanwhile, the National Planning Policy Framework (revised in July 2021) outlined by the government dictates that First Homes must be introduced on each development, however, the arrangement for such deliveries is complicated. With low-cost homeownership on each site still needing to make up 10% of the overall development, and First Homes taking up the first 25% of Affordable Housing it is unclear how the transition from shared ownership to the priority delivery of First Homes as a priority will take place, with little to no guidance available.
Andy said: “One big question still looms; Will First Homes see the end of Shared Ownership?”
In addition, the new model for Shared Ownership was set out by Homes England in April 2021 and inadvertently increases viability risks for housing associations delivering shared ownership properties following the government’s new preference for First Homes.
All this and more will be discussed in the 14th Annual Planning & Viability Conference. Book now to secure your place.