Planning Obligations SPD 2020

5. AFFORDABLE HOUSING

Justification

5.1 Current policy on securing affordable housing in new development is set out in the Harborough Local Plan 2011-2031 in Policy H2 (Adopted 2019). The minimum requirement for affordable housing provision is 40% on housing sites of more than 10 dwellings or with a combined gross floorspace of more than 1,000 square metres.

5.2 Although the policy sets this minimum requirement, a greater percentage of affordable housing may be sought if any subsequent local housing need assessment (e.g. obtained through a neighbourhood plan process) identifies for example exceptional housing sites in rural areas. Policy H3 of the Local Plan makes provision of affordable housing, in exceptional circumstances, in order to meet the high need across the District as demonstrated in the Housing and Economic Development Needs Assessment 2017 (HEDNA).

Definition of Affordable Housing

5.3 Affordable housing is defined as social rented, affordable rented and intermediate housing, provided to eligible households whose needs are not met by the market. Eligibility is determined with regard to local incomes and local house prices. Affordable housing should include provisions for the development to remain at an affordable price in perpetuity for future eligible households or, where any affordable housing development is subsequently sold on the open market for the value to be recycled for replacement affordable housing provision in the locality.

5.4 The NPPF (2019) definition of affordable housing refers to a number of housing products and includes a wider range of rented and low cost homes tenures and options. Social rented housing is rented housing owned and managed by local authorities and RP's (Registered Providers or Housing Associations), for which guideline target rents are determined through the national rent regime. This type of housing may also be owned by other organisations and provided under equivalent rental arrangements to the above, as agreed with the local authority or with Homes England.

5.5 Affordable rented housing is let by local authorities or Registered Providers (RPs) to households who are eligible for social rented housing.

5.6 Affordable Rent is subject to rent controls that require a rent of no more than 80 per cent of the local market rent (including service charges, where applicable).

5.7 Intermediate housing is homes for sale and rent provided at a cost above social rent, but below market levels. These can include shared equity (shared ownership and equity loans) and other low cost homes for sale and intermediate rent. Lower cost market housing cannot be considered as affordable housing for planning purposes.

Mix of Housing

5.8 Harborough District has an above average number of larger type dwellings (5-7 bedrooms) and a smaller number of 2-3 bedroom house types. Smaller dwellings are under represented in the range and mix of house types. It is evident that the number of smaller households is increasing. In light of this, the majority of our house type requirements will be based on smaller house types to meet demand.

5.9 Development proposals should therefore always seek to provide a mix of size and type of dwellings (both open market and affordable dwellings). In particular, housing for smaller households will be supported in order to meet District wide identified need.

5.10 The benchmark housing mix profile we will aim to seek on housing development sites, as referenced in the HEDNA 2017 at District level, is set out in Table 2.

Table 2 - On proposals above 10 units

5.11 This is an indicative mix for planning purposes within the District. Individual site issues will influence housing mix on a particular development - This is intended to provide a basis for the kind of house types/sizes we should seek as a starting point in future development. Applicants are advised to consult the Harborough District Council Housing Enabling Officer at the earliest opportunity to discuss and agree site/ locality specific requirements and details of the affordable housing contributions prior to the submission of a planning application.

• Current tenure requirement is to seek generally, a 60/40 split between rental properties (a percentage which would be accepted as affordable rent) and intermediate housing respectively. However each site is assessed independently in meeting specific local housing need;
• The affordable housing must comply with Homes England Quality Development Standards particularly in relation to space and floor areas as a minimum requirement;
• Affordable housing will be transferred to a partner Registered Provider (RP) at open market values to be agreed between the developer and the RP partner and approved by Harborough District Council.

Special Needs and Extra Care Housing

5.12 Special Needs housing may be included in the definition of affordable housing, where appropriate, or where proposed by specialist developers. In such cases there will usually be no further requirement for affordable housing contribution. Examples of those who may be in 'special need' include the elderly, 16-24 year olds, people with mental health or learning difficulties and people with special access requirements such as wheel chair users. The Council will also seek the provision of small 1-2 bed bungalows to meet the demand for this house type for our expanding elderly community on appropriate sites.

5.13 Special Needs housing is strongly encouraged and bespoke guidance and support will be provided to assist in implementation. The Council will work to meet wheelchair and Lifetime Homes Standards which are now covered through optional requirements in Building Regulations.

5.14 New forms of sheltered and retirement housing have been developed in Harborough District in recent years, to cater for older people who are becoming more frail and less able to do everything for themselves. The Council strongly supports such provision.

5.15 Extra Care Housing is housing designed with the needs of frailer older people in mind and with varying levels of care and support available on site. Most people who live in Extra Care Housing have their own self contained homes, and a legal right to occupy the property. Extra Care Housing is also known as very sheltered housing, assisted living, or simply as 'housing with care'. It comes in many built forms, including blocks of flats, bungalow estates and retirement "villages". It is a popular choice among older people because it can sometimes provide an alternative to a care home. There are communal facilities with domestic support and personal care available.

Rural Exception Sites

5.16 In response to evidence of local housing need, the development of sites for affordable housing as an exception to normal planning policy may be permitted in rural areas. Rural Exception sites are:

• Sites primarily set aside for affordable housing but could include some limited amount of market housing;
• Developed to meet local affordable housing need and generally held in perpetuity as 'affordable';
• Sites that are within, adjoining or in close proximity to settlements; and
• Developed on sites that would normally not be released for market housing.

Development of Affordable Housing

5.17 The Council supports a range of Registered Providers (RPs or Housing Associations) to provide and manage affordable housing in the District. A list of current providers and contact details is available in Annex 2 to this document.

5.18 The Housing Enabling Officer will engage with developers and ask them to contact RPs at the earliest stage so that an affordable scheme can be discussed and agreed preferably prior to the submission of a formal planning application.

5.19 Planning applications should be accompanied by an Affordable Housing Statement to indicate commitment to affordable housing provision through on-site provision. The question of accepting a commuted sum payment is a matter for the Council to determine if it deems it appropriate to accept an off- site contribution in lieu of on-site provision. It is not a matter for the applicant to propose. The Council will then seek to secure this commitment through a planning obligation.

5.20 The Housing Enabling Officer will provide advice on the delivery of affordable homes through the planning process. The Officer will advise on the provision of affordable housing in eligible applications, whether off-site provision is appropriate and whether a commuted sum should be accepted. The views of the community via local Ward Councillors and relevant Town/Parish Councils will also help inform the position the Council takes on the approach to the affordable housing component in new development.

5.21 The Council will seek, in general terms, a mix which is split of about 75% affordable or socially rented and about 25% low cost home ownership products.. However each site is assessed on its merits regarding how best it can meet local housing need and the Council will adopt a flexible approach in assessing need and provision. A variation of the mix which is shown to be justified by reference to the latest assessment of affordable housing need.

5.22 The affordable housing secured will be transferred to a Registered Provider (RP), at values to be agreed between the developer and RP.

5.23 Applicants are advised to consult RP's to discuss these matters at an early stage in the preparation of a planning application including an element of affordable housing.

5.24 The cost associated with the necessary level of affordable provision on any site should be factored in by the developer in their acquisition of the site.

5.25 Development proposals involving 100% affordable housing will not normally be exempt from S106 obligations as any new development is likely to have an impact and an affect on local services and infrastructure.

Commuted Sums

5.26 In accordance with both National Planning Policy Framework guidance (NPPF) and local policies, there is a clear preference for affordable housing to be provided within the site subject to planning approval. Whilst on-site provision will always be the priority option for providing affordable housing, it has become apparent that there are circumstances where the inclusion of affordable housing may not be practical or appropriate. In such circumstances, a commuted sum may be an acceptable alternative to the provision of units of affordable housing on a site. The following are circumstances where a commuted sum may be justified:

• Where a Registered Provider (RP) is unwilling to acquire affordable units. This may occur where the proposal involves conversion or redevelopment of existing buildings such as listed buildings or development in conservation areas. It may also occur because the affordable housing proposed may be in a location, or is of such a limited scale, that a Provider considers it unsuitable to manage efficiently.
• Where housing need priorities could be better met in an alternative location.
• Where there is a dominance of a particular type of affordable housing provision in the immediate area.
• Where the viability of the particular form of development might be compromised by the integration of affordable housing into that development, for reasons that can be clearly set out and justified. Submitted viability appraisals will be re-appraised by the Council (as referenced in paragraphs 3.5 above) before consideration can be given to acceptance of a commuted sum in lieu of on-site provision of any affordable housing obligation.

5.27 If a commuted sum payment is accepted, the value will be based on the cost to the developer of meeting the affordable homes requirement.

5.28 Using HDC's percentage requirement to guide negotiations, the off site contribution or commuted sum will be based on the following approach: We will agree the Open Market Value (OMV) of an affordable house type i.e. 2 bed terrace, small 3 bed semi etc. that can be achieved on any given site. Our requirement will be 50% of the OMV of an affordable house type x Harborough % of affordable provision requirement e.g. OMV x 50% for each unit X the number of affordable units required (40% of site yield).

To demonstrate, if the open market value (OMV) of a two bedroom house was £150,000 and the 40% affordable housing provision on a 5 dwelling site is 2 units, the commuted sum received would be 2 units x 50 % of the OMV (£75,000) = £150,000.

5.29 In certain cases, a developer undertaking multiple site development in the District may wish to provide affordable housing on a different site. The Council will consider whether the offer of provision of an alternative site is acceptable.

Spending of Commuted Sums

5.30 The Council will use commuted sums for the purposes of developing affordable housing in the District. The Council will report on the funds held and allocated to affordable housing development in its annual Authority Monitoring Report (AMR), produced for monitoring development planning matters.

For further information on affordable housing planning obligations please contact: Housing Enabling and Community Infrastructure Officer, Harborough District Council Tel: 01858 828282.