Councils under pressure to stop housing developers bypassing affordable housing

Councils under pressure to stop housing developers bypassing affordable housing

Over 30,000 38 Degrees members have mobilised across 27 different areas of England and Wales urging councils to force developers to make ‘financial viability assessment’ documents public and open to scrutiny.

Tens of thousands of people in England and Wales are urging their local councils to stop housing developers from purposefully avoiding building affordable housing. The 38 Degrees campaign, started by 27 members across England and Wales, comes after leaked documents revealed developers are deliberately misleading councils on expected profit.

Current planning law in England and Wales states that if a developer will not make ‘competitive returns’ – typically assumed to be 20% profit on a new development – they can ignore the council’s regulations about building affordable and social housing.

The developers’ leaked documents have shown that the calculations they use to work out their profit margins are purposefully misleading. By undervaluing the prices of the houses and over-costing labour in their ‘financial viability assessments’ – documents outlining the developers’ analysis of the finances of their own scheme – they can claim their profits are not enough to warrant building affordable housing.

Islington, Greenwich, Lambeth and Bristol councils have already introduced a policy that forces developers’  ‘financial viability assessments’ to be made public if they claim they cannot meet council targets of affordable housing in new developments. This will allow the documents to be scrutinised not only by the council but by housing groups and members of the public. Now, petition starters across England and Wales are urging other councils to follow suit.

30 members of campaign group 28 Degrees has started petitions targeting their individual councils, with over 30,000 people behind them to date.

The campaign follows the London Mayor blasting Wandsworth council over plans to slash the number of affordable homes in the Battersea revamp, the capital’s biggest building project, and on Wednesday announced plans to force developers who fall short of requirements to build low-cost homes to make financial records public to show why they cannot build more.

Louie Herbert, Campaigner, 38 Degrees, said: “By squirming out of building affordable and social housing, developers are adding to the country’s housing crisis as they cream off more profit, putting owning a home even further out of reach for many younger people.

“Councils in Islington, Greenwich, Lambeth and Bristol have all recently protected their residents from potentially unscrupulous developers by making sure that their reports are transparent and open to scrutiny. Now 38 Degrees members are asking 30 more councils to follow suit and hold developers to account. Together we can stop them from exploiting the current system purely for their own greed.”

The 38 Degrees petition asking councils to make developers be more transparent can be signed at:

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