When is a new home not really a new home?

There is a lovely field just up the road from where I live. When the mornings are light I run through it a couple of times a week. Oh look…..here’s me in the field on one of those runs last summer:



Charles Church Developments Ltd (part of Persimmon PLC) have put in a planning application to build 80 houses in this field. (As a matter of fact I think this is too many houses for the village to cope with in one go and there are three other sites in the pipeline. But this post isn’t about the rights and wrongs of this particular development). If Charles Church get the go ahead the field will look something like this:

Rogers+Lane+3D smaller

The initial planning application was turned down at Stratford Council’s Planning Committee (East) back in August 2014.

Charles Church have submitted an appeal, which will last 6 days and kicks off on April 28th.

If the appeal is successful (which in all likelihood it will be) then Charles Church will go ahead and build 80 houses.

And that will be that.

Apart from one thing. Stratford District Council’s planning rules insist that 30% of the houses – about 24 homes – must be what’s known as affordable housing. That means a number of housing associations will go into a bidding war to buy these 24 houses from Charles Church. To ‘win’ the homes one of the housing associations will have to convince itself that it makes sense to borrow even more money from the banks (or squeeze what it has to spend on services to existing customers or maintenance of existing homes) so that it can out bid their competitors.

When the houses are completed, and the people who have bought or rented them have moved in, the housing association will be left with a big fat debt to pay off for the next 25-30 years; and Persimmon PLC will have added to its £2.6bn turnover and £500m profit….and there will still only be 80 new homes in Upper Ryepiece field.

This is how most housing associations acquire most of their new housing. Not by actually building new homes but by buying properties from developers who would have built them anyway. It’s like calling yourself a farmer but buying your wheat or barley from a real farmer down the road when he has finished his harvesting.

Developers like Charles Church eat up green field sites and all we get in return is more ‘executive homes’ and a few measly ‘affordable homes’ that most people in real housing need can barely afford.

So it was exciting to read recently that the London based housing association L&Q is planning to actually build 50,000 new homes over the next 10 years. (If they do they’ll become, at a stroke, the 5th biggest house builder in the UK). L&Q won’t be buying houses someone else has already built. They will be genuinely increasing the overall number of homes. They will be doing all this without any funding from the tax payer. Because they’ll be doing the outright sale part too the profit from this won’t go to line the pockets of share holders but will help to reduce the amount of borrowing needed to fund the affordable housing and make sure there is as much of this as possible.

L&Q will be making sure their affordable homes are genuinely affordable  – by setting rents at 35% of average local incomes…..which means in some parts of London – like Westminster – the rents could be as low as 20% of market rents.

And because L&Q will be building many of the homes using their own construction company they will be able to control the quality of the build.

Of course this plan all assumes that L&Q can find sites to build on and sites that private developers, with their deep pockets, don’t beat them to. But it’s a bold and audacious plan which really would see a housing association make a small but valuable dent in the massive housing shortage – a shortage which is most pronounced in London and the South East. I wish them the very best of luck.






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