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Housing: Low Incomes

Volume 461: debated on Friday 15 June 2007

To ask the Secretary of State for Communities and Local Government what the total cost has been to run the Design for Manufacture competition since its inception; and how many of the resulting houses she expects to be sold for £60,000. (128191)

[holding answer 19 March 2007]: English Partnerships are running the Design for Manufacture competition on behalf of the Department for Communities and Local Government. All English Partnerships' costs are expected to be balanced out by receipts of more than £50 million from the sale of the land. This exceeds the reserve price across this portfolio of sites by more than £3 million.

The competition involved additional costs compared to ordinary site disposals. These costs are for specialist technical advice to ensure the quality of these innovative homes (£470,000), for monitoring and evaluation to learn lessons from the construction phase (£70,000) and for research and information (£136,400). This latter category includes holding a public exhibition attended by over 5,000 people and circulating some 30,000 copies of the document setting out the lessons learnt so far from the competition.

Part of the competition involved a target construction cost of £60,000 for a high-quality 76.5 sq metre home, with larger and smaller homes being built at a similar cost-efficiency. The competition is creating 10 new mixed communities developments with homes of different sizes and tenures to suit families and single people. Overall, 50 per cent. of the homes being provided will be affordable, including shared ownership/equity, social housing, low cost home ownership and other supported housing such as for the elderly.

I refer the hon. Member to the answer given to the hon. Member for North-East Milton Keynes (Mr. Lancaster) on 6 March 2007, Official Report, column 1890W, which set out precise details of one of the sites in the competition.

The other nine sites are at different stages of construction and are spread around the country. The prices of the units for sale will reflect the land value, the local market at the time they go on sale and the equity share as well as the construction cost. In total only about half the homes will be for sale at full market price.

Based on current sales prices we anticipate that on every site where homes are being sold, there will be homes available at shared ownership or shared equity stakes of between £60,000 and £70,000. The exception is on the Hastings site where all the homes will be for affordable rent.

To ask the Secretary of State for Communities and Local Government whether tests of affordability for homes to rent or buy are required to take account of local levels of household income. (141748)

The definition of affordable housing for planning purposes established by “Planning Policy Statement 3: Housing” and the accompanying guidance “Delivering Affordable Housing” includes the requirement that affordable housing should:

“meet the needs of eligible households including availability at a cost low enough for them to afford, determined with regard to local incomes.....”

What this means is that, in considering whether a home falls within the definition of ‘affordable housing’ or not, local authorities are required to assess whether or not the home is affordable to those eligible for such housing. One of the factors used in this assessment must be levels of local household incomes.