The Affordable Housing Supplementary Planning Document was adopted in November 2011. It provides further detail on the context and evidence for affordable housing and clarifies the planning delivery process. The SPD was subject to 2 rounds of public consultation and the responses received helped to shape the final SPD, including the introduction of a tariff approach to contributions for schemes of 6 to 10 units. The tariff table is available in Appendix C of the SPD and should be read in conjunction with the Submarket Area Map.
Update on Affordable Housing Policy and Applying the Vacant Building Credit
In November 2014, amendments to Planning Practice Guidance introduced changes to the way that affordable housing contributions should be sought from development. Essentially, these changes meant that the Local Planning Authority would no longer seek affordable housing or other tariff style contributions on or off site for affordable housing provision from developments of 10 units or less, and which have a maximum combined gross floor space of no more than 1,000sqm.
Up until this change, Policy PCS06 of the Core Strategy required an assessment of the viability of a site for 6 or more residential properties to establish whether a redevelopment proposal was viable and could make provision for affordable housing either on or off site.
Following a legal challenge by West Berkshire Council and Reading Borough Council, the changes were quashed (July 2015), by a High Court ruling that the planning policy to exempt small developments from affordable housing contributions and the vacant building credit were unlawful. The Department for Communities and Local Government were subsequently granted permission to appeal.
On the 11 May 2016, the appeal was allowed and the original changes reinstated in Planning Policy Guidance. As a consequence, Core Strategy policy PCS06 will no longer be applicable for sites of 10 units or less, and which have a maximum combined gross floor space of no more than 1,000m2.
Poole Local Plan 2018: Policy PP11 Affordable Housing
The Poole Local Plan was adopted on 13 November 2018. The Policy for Affordable Housing (PP11) states that major applications for housing schemes within use class C3 of 11 or more homes or over 1,000m2 in floor space will be required to provide affordable housing. This means that any application for 10 dwellings or fewer and under 1,000m2 floorspace will not be required to provide affordable housing.
The different land values across Poole mean that we will seek 2 different levels of affordable housing:
- within Poole town centre boundary: 10% affordable housing
- rest of Poole: 40% affordable housing
On sites of 21 units and more, affordable housing should be provided on site. Only in exceptional circumstances will we accept affordable housing off site or as a commuted sum payment.
On sites of 11 to 20 units, we will accept a commuted sum payment in lieu of the provision of affordable housing on site where registered providers are unwilling to take on the required level of affordable housing on site. The financial contribution will be equivalent to that provided on site (land, build and servicing). We are supportive of proposals that include on site affordable housing.
In all cases, to help achieve good place making and to encourage mixed and sustainable communities, the provision of on site affordable housing must be indistinguishable from market housing.
Our tenure mix is 70% affordable rent and 30% intermediate housing.
Other than in respect of starter homes, affordable housing provided under this policy should always be available to meet local needs and to remain at an affordable price for future eligible households or for the subsidy to be recycled for alternative housing provision.
In circumstances where developers contest that they cannot meet the affordable housing requirement, the developer must demonstrate the maximum amount of affordable housing provision and tenure mix that could be achieved on site viably, through the submission of a Residual Land Value (RLV) assessment as set out in Policy PP40: Viability.
Vacant Building Credit
In addition, the NPPG has now introduced the Vacant Building Credit. Essentially Vacant Building Credit is given where a vacant building is brought back into any lawful use, or is demolished to be replaced by a new building. The developer is offered a financial credit equivalent to the existing gross floor space of relevant vacant buildings when the Local Planning Authority calculates any affordable housing contribution sought. Affordable housing contributions would be required for any increase in floor space.
There is currently a lack of clarity on how the Vacant Building Credit will be calculated. Planning applications are not always made by reference to the floor space calculations since the number of planning units may be more relevant. In future, such planning applications will need to include the calculation of gross floor space in order to apply the offset or credit.
The driver behind the policy change is the government’s wish to reduce the obstacles on developers bringing vacant, under-used or brown field sites back into occupation. Residents and Members may have reservations about a policy which seems to reduce the contributions available for affordable housing, nevertheless, it is advised that as part of the NPPG, the council must pay due regard to the Vacant Building Credit and apply it to relevant planning applications.
At this stage, there is little guidance available as to how the Vacant Building Credit should be applied and because of its recent introduction there are no determined planning appeals or court decisions that have been found which give any steer on this.
At present affordable housing contributions are calculated by reference to complex viability assessments which are detailed and exhaustive and include reliance on external opinion provided by the District Valuer as to land values, etc. As such, Vacant Building Credit scenarios include:
- where a vacant building is brought into residential use, providing the use has not been abandoned, and the gross floor space does not exceed that of the building previously, then no affordable housing contribution will be payable, irrespective of the increase in residential units
- where the gross floor space exceeds that of the building previously, for example where additional floors, accommodation, or units are provided on the site, or where the building is demolished and replaced, a credit should be given in the amount of the previously existing floor space. If the floor space in the new development does not exceed that in the previous building, then no contribution is payable
- where there is an overall increase in floor space then a credit is given for the previously existing floor space and deducted from the overall affordable housing contribution calculation
The ways that either an on/off site provision or a financial contribution shall be calculated are as follows:
Example of Affordable Housing secured on or off site
| Building || Gross Internal Area (m2 ) || M2 Increase? ||% Increase in floor space ||Number of residential flats ||(a) 40% of Affordable Housing Units? ||Affordable Housing required |
| Existing || 800 || || || || || |
| Proposed || 2,400 (b) || 1,600 (a) || 66.6% (c) || 11 (d) || 4.4 (e) || 2.93 flats |
To establish the contribution, divide (a) by (b) to establish (c). Then multiply the number of residential units (d) by 40% to establish (e). Multiply (c) by (e) so the requirement would be 2 residential units on or off site. The remaining 0.93 will be sought as a financial contribution calculated as an equivalent value of on site provision.
As an example: if the Open Market Value of a flat is £160,000 a housing provider could afford to pay approx. 55% of the OMV to provide the unit as affordable, so the cost of the developers contribution for 1 residential unit would be £160,000 multiplied by 45% = £72,000 multiplied by 0.93 would be £66,960.
Example of Affordable Housing Contribution
| Building ||Gross Internal Area (m2) ||m2 Increase? ||% Increase in floor space ||Number of Residential Flats ||Tariff Table (Appendix C) Supplementary Planning Document ||£ sought? |
| Existing ||800 || || || || || |
| Proposed ||2,400 (b) ||1,600 (a) ||66.6% (c) ||11 ||£48 per m2 (d) || £78,800 |
To establish the contribution, divide (a) by (b) to establish (c). Then multiply (c) by (d). The rate varies depending on the type, location and seaward views from the proposed accommodation, so reference to Table C of the Affordable Housing SPD (adopted November 2011) will be required.
The council should apply the Vacant Building Credit in the simplest and most transparent way available. Until such time as further guidance or case law is available, the council should calculate the amount of affordable housing contributions required from the development as set out in our existing planning policy. The Vacant Building Credit should then be applied as a proportion of the overall floor space of the new development.