Who's afraid of affordable housing? Not London developers


It's rare to find even a luxury scheme in London without affordable flats, writes Angela Pertusini

GIVEN the scarcity of available development sites in London, you would think that developers would fall over themselves to get their hands on a piece of land big enough to build a couple of dozen or more homes upon. But the development game has become a bit of a double-edged sword since the government has taken to pursuing section 106 of the Town and Country Planning Act (1990).

This piece of legislation, which is every bit as dry as it sounds, included the now-notorious clause that allowed the formalisation of a you-scratch-my-back system meaning that local authorities could demand some sort of amenity from builders when considering granting planning consent. In the early years, this might be road improvements or providing a playground but over the past decade it has almost invariably meant an "affordable housing" allocation.

Now anyone building more than 25 homes on a site measuring a hectare (2.47 acres) or more must provide affordable housing. In London, mayor Ken Livingstone, has pursued the policy with such enthusiasm that the threshold has dropped to half a hectare and 15 properties. So, driving around the capital, it's rare to see a site hoarding that doesn't include banners of the housing corporation's cheerfully naïve line drawing of a house and rising sun beneath the laughably slick CGI's of couples wandering through tree-lined courtyards or staring in awe at soaring glass and steel edifices.

And it's that housing corporation presence which has made the difference because, although developers like to give the impression that they are giving the homes away, they are, in fact, working in partnership with housing associations who, through government grants and private funding, pay for the construction of the affordable housing element of the site and demand certain standards are met. (One surveyor told me that, gallingly for open-market buyers, the spec on the affordable units can often be higher than on the "normal" properties.)

So, despite much grumbling and heel-kicking by developers, the only thing that they are "giving away" is control of a part of their sites - usually the bit nearest the bins/flyover/abattoir. Early attempts to build the social segment on another site completely have largely been swatted away as, despite being a nation still obsessed with class, perpetuating this through our house-building was seen as a bit unhelpful. It's now rare to find a development, even of the "luxury, fully en-suite, double-garage" kind that doesn't have a discreet block of flats within it and a queue of hopeful-looking applicants.

Because not just anyone qualifies for these homes. Most of the affordable housing isn't really, it's flats that can be bought through shared ownership, with the buyer purchasing a proportion, usually 50 per cent or more, and paying rent on the rest. As their prospects grow, they can buy more of their home and pay less rent.

If you're a keyworker - a teacher, nurse, firefighter or police officer, for example - then you get priority. In fact, access to these sorts of schemes is one of the main reasons for going into the caring professions nowadays. These deserving poor are followed by those in "housing need" and then low-earners generally. Although, you can't be too low because, like the developers, the housing associations aren't exactly giving these flats away - typically, a one-bedroom unit in a zone 2 location will be £250,000 upwards - but the rent that it is paid will be subsidised.

When the scheme first started there were a lot of scare stories about how open-market buyers would find themselves with tenants from hell on their doorsteps - social housing being more or less synonymous with the feckless and anti-social as far as most home owners are concerned. But this hasn't really happened on new sites (although some old council housing estates have been upgraded with a private housing allocation to pay for the improvements) and Londoners have just got used to the idea.

Even developers I spoke to wearily described providing affordable housing as "inevitable" rather than showing much hostility to the idea. So, fear not, as the phenomenon begins to take grip in Dublin.

It hasn't exactly slowed the market down on this side of the Irish Sea and surely you wouldn't want to be the sort of person who would deny a nurse or teacher the chance to own (a bit of) their own homes?