Provision of Affordable Housing Within New Developments (Updated May 2016)
The Arun District experiences high levels of housing need and housing affordability is now a major issue locally due to the relationship between house prices and household income. The market therefore excludes many people seeking access to housing in the district therefore the Council continues to enable an appropriate level affordable housing.
Affordable housing is social rented, affordable rented and intermediate housing, provided to eligible households whose needs are not met by the market; eligibility is determined by the Council’s Allocations Policy. Affordable housing should include provisions to remain at an affordable price for future eligible households or for the subsidy to be recycled for alternative affordable housing provision. Affordable housing which does not meet the prescribed definition in the National Planning Policy Framework (NPPF) at Annex 2, such as “low cost market” housing, will not be considered as affordable housing for planning purposes. Please see the Interim Affordable Housing Policy.pdf [pdf] 12KB
Council's retained consultant for assessing developer viability appraisals
Dixon Searle Partnership (DSP) (www.dixonsearle.co.uk) are the council’s retained consultant for assessing developer viability appraisals (DVAs). Developers/applicants who provide the council with a DVA as evidence as part of a residential planning application will have their appraisal referred to DSP and must pay the referral cost (as below) to DSP at the point of referral by the council. DSP will issue an invoice to the applicant and will proceed with their DVA review on receipt of payment.
DVA fees review scale:
- 1-10 dwellings – the council will not apply its Affordable Housing Policy
- 11-15 dwellings - £1,500 + vat
- 16-30 dwellings - £2,000 + vat
- 31-100 dwellings - £2,500 + vat
- 100+ dwellings – approx. £2,500 - £5,000 – DSP will provide a review fee quote depending on the nature of the scheme proposal, nature and number of appraisal iterations and tasks associated with the DVA review.
Fees for the review of DVAs associated with mixed-use schemes (i.e. containing other uses in addition to residential) will need to be quoted specifically.
To inform the review of their DVA, applicants will need to supply, as a minimum, information in accordance with the Council’s checklist and send it to the council’s Housing Strategy and Enabling Manager (email@example.com) for referral to DSP. An alternative checklist may be issued to applicants by DSP for some review cases, depending on their complexity and detail.
Applicants will generally be expected to supply a policy compliant appraisal scenario for comparison with their non-compliant/offer position version. To aid the openness of the review process using a shared platform, they will also be asked to provide their functioning version appraisal. To that end, the Council gives encouragement to applicants considering the use where possible of industry standard appraisal toolkits, including for example the freely available ‘Development Appraisal Tool’ as issued by the HCA (more details available on request). For larger and more complex scheme proposals, proprietary software such as Argus Developer is often used by DSP.
Upon referral of complete information, DSP will aim to produce a report to the council within 20 working days (sooner where possible). Following review by the Council a copy of the report will be made available to the applicant and may be published by the council.
For the effective independent running of the process, any contact with the applicant over the review details will be via the Council, unless the Housing Strategy and Enabling Manager confirms otherwise.
The council’s referral process to DSP will adhere to the latest Planning Practice Guidance (PPG) on Viability with the following factors in particular taken into account;
- Gross Development Value (Para 021)
- Costs (Para 022)
- Land Value (Para 023) and;
- Competitive return to developers and land owners (Para 024)
Amongst the other reference sources in this area, the RICS Guidance Note GN 94/2012 ‘Financial viability in planning’ will be used and may also provide useful background for applicants.
The review fee will include limited allowance for up to approximately 4hrs / 0.5 day for any initial follow-up (queries/feedback and dialogue) where needed, again conducted via the Council. Beyond this, any ongoing DVA review involvement will require further consideration and potentially additional fees to be covered by the applicant (but in any event with the individual circumstances dealt with case by case).
Any enquiries on this process can be made to the council’s Housing Strategy and Enabling Manager:
For more information please see the financial appraisal checklist.pdf [pdf] 20KB.
Please note that since May 2016 the Council will publish developer viability appraisals in full on our website if the application fails to meet the Council's affordable housing policy requirements.
In implementing its Affordable Housing Policy, the Council will seek 30% affordable housing on-site on residential developments of 15+ residential units. The tenure, dwelling type/size and location of on-site affordable housing must be agreed with the Council’s Housing Strategy and Enabling Manager.
For residential redevelopments of 11-14 units, the Council will seek 20% affordable housing on-site as below;
11 units = 2 affordable homes
12 units = 2 affordable homes
13 units = 3 affordable homes
14 units = 3 affordable homes
For residential developments of 11-14 units, the Council will accept either affordable housing for rental or intermediate housing in accordance with the National Planning Policy Framework (NPPF). The tenure, dwelling type/size and location of on-site affordable housing must be agreed with the Council’s Housing Strategy and Enabling Manager.
If it is agreed with the Council’s Housing Strategy and Enabling Manager that on-site delivery of affordable housing on developments of 11-14 units is neither viable nor practical, the Council will accept a commuted sum payable in lieu of on-site affordable housing of £45,000 for each foregone affordable dwelling. This sum will be included in the S106 agreement and will be payable in full on completion of the development.
The Council will not apply its Affordable Housing Policy on developments of between 1 and 10 residential dwellings.
For information and advice on the application of the Council’s Affordable Housing Policy, please contact Andy Elder - Housing Strategy and Enabling Manager on;
T: 01903 737714