Report by Service Lead – Affordable Housing (attached).
The Committee considered a report by the Service Lead – Affordable Housing (circulated previously) regarding gap funding of 21 social rents at Woolacombe.
The Service Lead – Affordable Housing highlighted the following:
· The Community Housing Fund and commuted sums from Section 106s were not sufficient alone to enable all existing nor future community-led housing projects. How to resource the delivery of affordable housing via community-led housing models both financially and in terms of staff was within the scope of Project 4 of the Housing and Community Safety Programme.
· There was an immediate issue to consider to enable the completion of 21 affordable homes for social rent in Woolacombe; the first Community Land Trust scheme in North Devon. Due to a forecasted start on site date of September 2023 (subject to planning) this cannot wait for the outcome of the corporate project.
· External funding had now reached £141,000 per unit and £30,000 per unit was needed to deliver the scheme. The Council needed to consider how this could be gap funded or the scheme would not go ahead.
· Since writing the report, the Government had announced that it was not renewing the Community Housing Fund.
· Mortehoe was one of the first Community Land Trusts set up through the original Community Housing Fund allocation in 2016/17 and they have come on leaps and bounds since. With the passion and energy of the community, the Community Land Trust, parish councillors, the parish clerk, the ward member, the National Trust, Middlemarch and NDC officers the scheme was soon to become a reality.
· The site was presented to the community and had huge community support. Mortehoe and Woolacombe Community Land Trust applied for funding from the NDC Community Housing Fund for pre-application and feasibility work. Pre-app feedback from Planning had been acted upon and a compromise reached with AONB, planning, the Community Land Trust and the National Trust as a possible way forward for the planning application package.
· The Community Land Trust had now selected a Registered Provider (Aster) who was putting together a funding package to deliver the proposed 21 affordable homes in Woolacombe (subject to planning). Homes England and Aster have put in significant amounts of funding at £141,000 per unit resulting in almost £3 million of government/Registered Provider funding into North Devon. To gap-fund the remainder of the scheme North Devon Council would need to provide £630k (£30,000 per unit).
Councillor Lofthouse arrived at the meeting.
· The Council, via its former Executive (in January 2018) had previously minuted its clear support for this scheme (even if via borrowing) in the future.
· Explanation of how it worked when a Community Land Trust partnered with a Registered Provider as detailed in paragraph 4.7 of the report.
· Paragraph 5 detailed the options for funding the scheme. In terms of the commuted sums, it was important to spend the sums prior to the 10 year deadline.
· This scheme would provide an opportunity to provide local housing which was 100% affordable and 100% social rent which was less than half of the local rent for properties in Mortehoe.
· The parish of Mortehoe was particularly suffering from the reduction of private rented sector housing and affordability issues. Most open market housing was out of the reach of the local community and was lost to second homes, Airbnb and other forms of holiday lets.
The Chief Executive highlighted the following:
· The Leader of the Council had recently highlighted in his column in the North Devon Gazette that over the last 2-3 years, around 467 private rented properties had been lost to holiday lets or second homes. This had a big impact on communities. The community of Woolacombe was feeling the impact of this.
· A number of parishes had around 60% holiday lets or second homes. In Woolacombe, this was around 62%.
· Analysis showed that there had been around 70% reduction in private rented housing available over the past few years. The provision of social rented properties in Woolacombe would help to address this issue.
In response to questions, the Service Lead – Affordable Housing advised the following:
· That responses from Ward Members in Ilfracombe and South Molton had been received in response to consultation who were in support of the scheme and the use of commuted sums from the parishes that they were received.
· The Registered Provider was required to reinvest returns into affordable housing. Therefore any profit made would be put back into affordable housing. This was a social rent scheme and the grant agreement would make it clear that any properties sold on the open market that the Council would receive a claw back. But it should be noted that properties owned by CLTs cannot be sold on the open market, they were protected in perpetuity from the Right to Buy and the Right to Acquire.
· The Community Land Trust would own 100% of the freehold.
· The Registered Provider was investing funds into the building of the houses.
· All properties were 100% affordable and 100% at social rent.
Councillor Wilkinson declared a personal interest as a Member of the Mortehoe and Woolacombe Community Land Trust.
In response to questions, the Director Resources and Deputy Chief Executive advised the following:
· The replenishment of the community housing fund would be subject to a separate decision as part of in-year budgetary management and the annual budget setting processes.
· The budget setting process would support the delivery of the Council’s corporate objectives.
· The commuted sums received from section 106s were time limited and there was a risk to the Council that if they were not used within the funding period then the Council would be required to repay these funds back to the developer.
· Even though the Government had announced that the Community Housing Fund would not be renewed, it was anticipated that there would be other Government funding initiatives available in the future.
In response to questions, the Chief Executive advised the following:
· That the Planning team structure was not being reduced and that would be an increase and that staff were being supported.
· If this scheme was approved and went ahead, the Council could use this scheme as a good example to secure funding for other such schemes.
Councillor Prowse advised that there was a political commitment for a priority process to be put in place for the provision of affordable housing and to support those parishes where commuted sums had been used for this scheme if schemes came forward and were considered to be a
RESOLVED that for the delivery of 21 social rents in Woolacombe the following be allocated:
(a) £372,194.60 from identified Section 106 affordable housing commuted sums as outlined in section 5.1.
(b) £162,805.40 from the Community Housing Fund – Housing Enabling Earmarked Reserve as outlined in section 5.2 of the report.
(c) £95,000 of current approved capital programme budget from the remaining balances of a previous affordable housing delivery grant and a former affordable housing fund as outlined in section 5.3 2.2 of the report.
(d) That Council vary the Capital Programme by £535,000 as detailed above and that funds be released, subject to a Grant Agreement with the Registered Provider (Aster) upon such terms and conditions as may be agreed by the Service Lead for Affordable Housing and Senior Solicitor and Monitoring Officer.
Councillor Wilkinson left the meeting.