Policy HOU2: Affordable Housing
1. The Council will make provision for at least 10,420 new affordable homes.
2. These will be provided by requiring 50% affordable housing on sites delivering net 10 or more homes on sites where land has been released from the Green Belt or where development is permitted within the Green Belt and by requiring 24% affordable housing on all other developments delivering net 10 or more homes.
3. The tenure split of these homes, which is 21% rented housing with rent set at social rent, 36% affordable rent and 43% affordable home ownership comprising Shared Ownership with the initial share being set at 25% and/or discount home for sale at 50% market price.
4. Alternative tenure mixes are acceptable for specialist housing. Affordable housing should be agreed in discussion with Basildon Council having had regard to the most recent evidence base.
5. For all affordable housing, provision must be made for it to remain at an affordable price for future households or for any receipts to be recycled for alternative affordable housing provision.
6. All housing, including af fordable and specialist housing, will be protected unless replaced with at least equivalent floorspace
7. The size and mix of af fordable housing should be agreed in discussion with Basildon Council having had regard to the most recent evidence base.
8. All Strategic Housing Allocations must meet their affordable housing contribution on site (unless off-site would result in public benefits). For other housing developments generally, all affordable housing should be provided on site. However, where sound planning reasons can be demonstrated the following sequential test should be applied:
a. Partial on-site provision and a proportionate financial contribution;
b. Full off-site delivery via a donor site;
c. A full financial contribution.
9. Proposals that would sub-divide or under-develop sites in order to avoid making the affordable housing contribution will be refused permission.
10. The Council will require all affordable housing to be:
a. designed and built to the same standard as market housing,
b. be indistinguishable from market housing in external appearance and have vehicle parking provided at the same ratio as for the development as a whole,
c. be integrated throughout the development except where it can be demonstrated that grouping together affordable dwellings is necessary to limit service charges and/or facilitate management of the units.
11. Viability assessments will not be accepted for schemes on strategic housing allocations.
12. On all other sites, viability assessments will be considered on a case-by-case basis. Where a lower provision is justified:
a. Af fordable housing will be required at the level and tenure mix where the development becomes viable, and
b. Early and/or Late-Stage reviews of viability up to policy compliance will be secured by the Council through legal agreement.
Reasoned Justification
Paragraph 67 of the NPPF sets out that as part of the ‘Golden Rules’ for development on land released from the Green Belt or where development is permitted in the Green Belt affordable housing requirement should be a) be set at a higher level than that which would otherwise apply to land which is not within or proposed to be released from the Green Belt; and b) require at least 50% of the housing to be affordable, unless this would make the development of these sites unviable.
The South Essex Housing Needs Assessment 2022 (SEHNA) (table 6.2) identified that 57% of newly forming households in the borough are unable to purchase entry level market housing and 37% are unable to afford to rent entry level market housing. This equates to a demand for a net need of 521 new affordable homes per annum or 10,420 new affordable homes over the plan period.
The SEHNA 2022 also considered the role of different affordable housing products.
The NPPF defines Affordable housing for rent as meeting all of the following conditions:
a. the rent is set in accordance with the Government’s rent policy for Social Rent or Affordable Rent, or is at least 20% below local market rents (including service charges where applicable);
b. the landlord is a registered provider, except where it is included as part of a Build to Rent scheme (in which case the landlord need not be a registered provider); and
c. it includes provisions to remain at an affordable price for future eligible households, or for the subsidy to be recycled for alternative affordable housing provision.
For Build to Rent schemes, affordable housing for rent is expected to be the normal form of affordable housing provision (and, in this context, is known as Affordable Private Rent).
Basildon Council has about 11,000 socially rented homes. In 2023/24 13 new socially rented homes were built in Basildon Borough and 278 social rent homes were let to new tenants of the Council (excluding transfers and mutual exchanges). At this time there were 1,934 households on the Council’s Housing Register.
Affordable housing for rent
Table 1: Estimated Annual Cost of Affordable Rent and Income Required (Source: SEHNA 2022 Table 6.9)
Discount Housing for Sale
Discounted housing for sale including First Homes schemes reduce the annual costs required to access home ownership. A 50% value could potentially make home ownership accessible to the majority of households in the borough however significant savings for a deposit would still be required and it would not meet the needs of households preferring the flexibility of private rent or unable to access mortgage funding.
Table 2: Benchmarking Cost of Discounted Housing for Sale. Household income is rounded to £5000 bands (Source SEHNA 2022 Table 6.10)
Housing
Purchase (any)£46,46443% 57%
Purchase (new)£33,24756% 44% Market Rent£29,70063% 37% 80% value£26,598 71% 29% 8% 70% value£23,273 71% 29% 8%
Shared Ownership Housing
Table 3: Estimated Income Required to Access Shared Ownership (Source SEHNA 2022 Table 6.11)
Housing ProductAnnual Income
Purchase (any)£46,46443% 57% Purchase (new)£33,24756% 44% -7% Market Rent£29,70063% 37%
share£19,68479% 21% 16% 25% share£18,95579% 21% 16% % of Basildon Borough unable to afford on household income only1 Open Market Sale 57% Open Market Rent 37%
Discount Market Sale (80% of market rate)29% Affordable rent (80% of market rate) 29% Shared Ownership 21%
Only 8% of households are able to access 80% market rent but not able to access market rent. This increased to 16% if Affordable Rent is limited to 60% of market rent.
This equated to 43% of households requiring affordable housing being able to access Affordable Rent limited to 60% of Market Rent.
To comply with the NPPF glossary definition of Social Rent, a scheme must meet all of the following conditions: (a) the rent is set in accordance with the Government’s rent policy for Social Rent; (b) the landlord is a registered provider; and (c) it includes provisions to remain at an affordable price for future eligible households, or for the subsidy to be recycled for alternative affordable housing provision.
The SEHNA 2022 identified that 21% of households were unable to afford any higher rental costs than social rent and that there is an average supply of 409 lettings to new tenants per annum.
Affordable rent (60% of market rate) 21% Social Rent 0%
1 For home purchase a 5% deposit is assumed with repayment over a 25 year period at a fixed interest rate of 3%. For Shared ownership the cost of both the rent and the mortgage is included.
In plan making and decision-making viability helps to strike a balance between the aspirations of developers and landowners, in terms of returns against risk, and the aims of the planning system to secure maximum benefits in the public interest through the granting of planning permission.
These policy options are subject to whole plan viability assessment.
Alternatives Considered
No policy on tenure and types of affordable housing- this is not recommended as it would leave the market to determine the range of affordable housing and risk not meeting local needs.