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Developers To Reduce Affordable Housing

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Housing developers in the UK could gain hundreds of millions of pounds in windfall profits under a new policy that lets them reduce contributions to building affordable housing or even avoid paying altogether, a council has claimed.

Since December, the government has exempted anyone who turns an empty building into private housing from paying for further affordable units, even if they could do so and still make healthy profits...

http://www.theguardian.com/society/2015/feb/01/property-developers-affordable-housing-councils-empty-buildin

So then, a victory for capitalism, or crony capitalism ?

Can't say I'm a great fan of the original policy, but without measures to evolve, reform or replace, and in the light of policies such as HTB and blocking the bill for revenge evictions, difficult to see it as anything but another example of the latter.

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I'm quite happy for new estates not to have social housing. Who wants to buy a nice new house only to have the nearby houses filled with people who otherwise would not be able to afford to live in your nice new estate.

The soloution to the problem is to build new council estates to house these people.

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Misleading, it's not the developer that pays the contribution it's the landowner via a lower price per acre for the land – like the banks the developer never loses – our government has made sure of that.

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The affordable housing construction laws seem to have contributed to a lack of afordable housing, because they complicate and limit the capacity to build in the first place

Edited by Si1

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Affordable housing is a misnomer. The question that needs to be asked is: why is housing unaffordable. This will give you the right answer and the solution. Sadly it is a question that is never asked, hence the various schemes that both inflate and pretend that 2007 was normal. Heaven forbid we actually built social housing en masse to replace all that social housing sold off.

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I'm quite happy for new estates not to have social housing. Who wants to buy a nice new house only to have the nearby houses filled with people who otherwise would not be able to afford to live in your nice new estate.

The soloution to the problem is to build new council estates to house these people.

stalags they are called in foreign parts.

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Affordable housing is a misnomer. The question that needs to be asked is: why is housing unaffordable. This will give you the right answer and the solution. Sadly it is a question that is never asked, hence the various schemes that both inflate and pretend that 2007 was normal. Heaven forbid we actually built social housing en masse to replace all that social housing sold off.

Totally agree. Although whenever I have said this to anyone, I mainly get blank faces. It's like people have read and heard it so much and they kind of can see that it is boll*cks but have convinced themselves that it must be true, or just want it to be true so much...

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Misleading, it's not the developer that pays the contribution it's the landowner via a lower price per acre for the land – like the banks the developer never loses – our government has made sure of that.

Or the end-user - its all a big game in the end.

I'm quite happy for new estates not to have social housing. Who wants to buy a nice new house only to have the nearby houses filled with people who otherwise would not be able to afford to live in your nice new estate.

The soloution to the problem is to build new council estates to house these people.

A reasonable objection for estates for 'these people' is that you risk creating ghettos - it is a tricky issue though to be fair.

More to the point, 'affordable housing' could technically mean a £700,000 flat in London - however well intended, the policy can be completely bonkers.

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There has just been something on the BBC about this topic (caught it by chance so didn't see the whole report). Some council estate redevelopment lead by one of the big builders is turfing out temporary council tenants (have to move miles away) and making existing ex-council flat owners go into a shared ownership flat and are offering them a trivial sum for the existing flat. All because only 10% (I think) of the new properties (many more than were originally there) are affordable housing.

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I agree with Tinker that the whole thing is a misnomer/fallacy.

Actually, again, I have to refer to my own experience. Bangkok has no socila housing policy, no HB 'clients' and no real interference in what is going on development-wise.

It has many faults, but the city is now world class, with modern, affordable housing for an average wage-earner. Who could say that for a contemporary worker in London?

It seems that the more complex you make the whole system, with planning permissions, exceptions, Section 104's and requirement for this and that (including 'social' housing), the less the actual housing becomes affordable to those who are, er, going to use it!

For those interested in the facts, I would estimate current average BKK wage at B16,000/month. Nice local 1-bed apartment in easy reach of skytrain/subway station would be B450,000. This is less than 3 x annual income.

Also worthy of note would be the rental income on said flat would be B3500/month, which is just 22% of earnings (after tax, as none payable at this kind of low wage). The yield is just over 9%.

I would say that is a sign of a property market fit for purpose - i.e. for people who live and work in the vicinity!

But, of course, if you are Boris, then this does not matter and you instead want to develop world class asset classes or some such buffoonery.

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For those interested in the facts, I would estimate current average BKK wage at B16,000/month. Nice local 1-bed apartment in easy reach of skytrain/subway station would be B450,000. This is less than 3 x annual income.

Also worthy of note would be the rental income on said flat would be B3500/month, which is just 22% of earnings (after tax, as none payable at this kind of low wage). The yield is just over 9%.

I agree.

However they don't have a thriving Banking sector sucking on the teat of peoples need for shelter.

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I agree.

However they don't have a thriving Banking sector sucking on the teat of peoples need for shelter.

Ah, yes, I was wondering what was missing in this primitive economy of ours here!

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