Boost for council's bid to offer more housing
EXETER City Council is to buy 11 new homes – for £1 each.
The homes are all on the former Royal Naval Stores Depot (RNSD) site and are among 34 affordable homes which were to have been bought from the developer by a housing association.
Unfortunately, the housing association was unable to proceed with the purchase. However, rather than lose all 34 homes for needy families, the city council has negotiated the purchase of 11 for a total of £11, thereby allowing the developer to make up its losses by putting the other 23 homes on the open market.
The homes will be ready at the end of next month.
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The city council is also to buy five new affordable homes within the Dean Clarke House development, for £212,535 or £42,507 per home. These will be ready in 12 months' time.
Sarah Ward, Exeter's assistant director for housing and contracts, said: "All new affordable housing goes some way to meeting the city's housing needs. We particularly welcome the opportunity to acquire these homes so cheaply because it increases our ability to make improvements to our existing housing stock or fund further new affordable homes."
Mrs Ward added: "As usual, we negotiated a percentage of affordable housing on each phase of this site. The developers agreed to build the homes and sell them to housing associations for an agreed price. Then the government grants were cut/removed and suddenly no housing associations could afford to pay; most affordable housing needs a subsidy because the rents don't cover the costs of borrowing the build and land costs.
"Thirty-four affordable units were left unsold at this point. We re-opened negotiations with the developers and they agreed to sell us 11 units for £1 and sell the rest of the units on the open market. The proceeds from the open market sales were used to cover the developers' losses on the 11 units."
Councillor Rob Hannaford, the city's lead councillor for housing and community involvement, said: "Affordable housing is the city council's biggest priority and challenge.
"The economic downturn that has severely affected the housing market in tandem with deep central government cuts to housing grants, means that we are facing a range of different obstacles to provide more homes in the city for those on low and medium incomes. Despite this we are working very hard to do the best we can under very difficult circumstances to make progress by looking at new and creative ways to get good deals and a shrewd management of existing resources."
The city council is planning, because developers are finding it hard to deliver 35 per cent affordable housing in the current economic climate, to reduce it to 25 per cent on a temporary basis.
Nine of the 16 homes are suitable for wheelchair access.
There are approximately 118 households who require wheelchair accommodation in Exeter and who are living in homes that are unsuitable.
The demand is further exacerbated by the low turnover of existing wheelchair-accessible accommodation in the city.