With regard to the Liberty Property Trust’s application for a massive development of 2,750 homes at North of Horsham, it’s now official. In the HDC published Addendum to the Planning Committee Report for 22nd May it rather begrudgingly states; ‘It is acknowledged that elements of the viability assessment, specifically sales revenues and costs, date from prior to the submission of the application’.
The application was submitted in July 2016 but we have already discovered that the projected house prices are based on September 2015 values so, by the time the Planning Obligations are finalised, they will be two years out of date. But according to National Planning Guidance the figures used for viability assessments should be ‘current’.
Does this all matter? Well, virtually all of the income is generated from house sales and reference to the Nationwide House Price Index for the Outer South East Region shows that from 3Q2015 to 1Q2017 prices rose by an average ten per cent.
So if we take the unlikely assumption that all costs also rose by ten per cent. That would mean that the pot of money available for S106 (Schools, Roads etc.) would also be ten per cent bigger i.e. the £53m currently on offer should be around £5.3m more, thereby significantly reducing the identified shortfalls of £6.6m. Of course the developer/landowners do even better, as their profit rises from £250m to a staggering £275m!
However, if we take the more likely scenario that building costs have increased by a lesser percentage (using a cautious six per cent, as the council’s own consultants were indicating four per cent earlier this year) the viability improves dramatically.
Twenty-five per cent Affordable Housing is then easily achievable against the disgraceful 18 per cent offered, and all compared to the HDPF policy requirement of 35 per cent.
But don’t worry, HDC proposes to accept the ‘old’ figures and go with both the S106 and Affordable Housing shortfalls as it plans a viability check in five years’ time when, if proven, matters will be adjusted.
Are you as sceptical as me about all of this?
Cox Green, Rudgwick
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