Decision details

To enter into an agreement with Linden Homes to purchase 8 properties for affordable housing.

The Housing Portfolio Holder presented a report on the provision of Section 106 Affordable Housing at Barnfield in Roydon.

The Portfolio Holder stated that the Council Housebuilding Cabinet Committee, at its meeting in June 2015, considered a report that explored the options available to ensure that all 1-4-1 Receipts from Right-to-Buy sales were spent within the required three years of receipt and none were passed on to the Government, with interest. Amongst others, the option of purchasing affordable homes built on Section 106 sites was recommended and subsequently agreed by the Cabinet in July 2015, with delegated authority passed to the Director of Communities to negotiate with developers. Linden Limited, who had an option to purchase and develop a Section 106 site at Barnfield in Roydon, had been approached and negotiations had been held over the purchase of eight affordable rented homes and three shared ownership homes. The negotiated value for the affordable rented homes of £1.464million was within Policy and within existing capital resources, but it required a Cabinet decision as the sum exceeded £1million.

In response to a question, the Director of Communities informed the Cabinet that the provision of shared ownership property was a specialist activity which the Council was simply not set up for. The Portfolio Holder added that all Council properties were available to all residents across the District, and not just to residents in the locality of the development.

Decision:

(1)        That an agreement be entered into with Linden Limited to purchase 8 affordable homes, delivered as part of a Section 106 agreement at Barnfield, Roydon, in the sum of £1.464million, funded in part from 1-4-1 RTB receipts and the balance from existing Housing Revenue Account Capital resources;

(2)        That the purchase of three shared ownership properties by B3Living, one of the Council’s preferred Housing Association Partners, making up the balance of the affordable housing on the Section 106 development be noted; and

(3)        That the Chairman of Council be requested to waive the call-in for this decision on the grounds that there was insufficient time to wait for the call-in period to complete before the very tight deadline set by Linden Limited to complete the agreement expired.

Reasons for Decision:

Although the expenditure was within policy and budget, it exceeded £1million which constituted a Key Decision and required either a Cabinet or Council decision.

Other Options Considered and Rejected:

To not purchase the eight affordable homes form Linden Limited. However, this would almost certainly result in the Council returning 1-4-1 Right-To-Buy receipts to the Government, with interest at 4% above the base rate.