what does the act mean for development the orbit perspective support/eastern resources/maggie... ·...
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What does the Act mean for development
The ORBIT perspective
Maggie McCann (Development Director, Orbit East & South)
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ORBIT – Housing Association or Developer
40,000 homes
> 1,700 new homes all tenures in 16/17
Completing 2,000 per annum to 2020
2nd largest development pipeline
Up to 350 market sale pa
Growing PRS
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09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17 Fcst
East Region Completions
Rent
LCHO
Market sale
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Overview
Starter Homes
Right to Buy
Permission in principle
“Pay to Stay”
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Housing and Planning Act 2016 - Starter Homes
Minimum 20% Discount ?
Applies to sites over 10 homes
Can be commuted off site
Secured by S106
Takes precedence over other
affordable
EXEMPTIONS
Viability
PRS – off site
Specialist Housing
Affordable led and Regeneration sites ?
Rural
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Are Starter Homes Competing with
other sale options?
Rent to Buy
Shared Ownership Shared Equity
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Will Starter Homes squeeze out other affordable?
Replaces other tenures in S106 (20%)
Developer builds and sells
5 -10% other affordable tenures
Reduces Orbit programme by 100 per annum (in East)
560 reduction pa nationally
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Starter Homes - opportunity
Can we deliver the Starter Homes
Experience of marketing and selling to similar clients
Help to differentiate the product from market sale
Developer needs the cashflow and pre-sales from RP
Why would we want to?
Economies of scale of marketing with Shared ownership?
Buy them at the right discount improve our profits – marginal
On our own market sites we will assess in same way as developers
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Housing Planning Act 2016 – Voluntary RTB
Sell the Home
How many?
How much for ?
When do we get reimbursed?
Build the replacement
Where?
What tenure?
Can planning help?
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Housing Planning Act 2016 – Voluntary RTB
ORBIT NUMBERS
3,000 existing preserved RTB
39 RTB sales in 2014/15 = £1m profit to reinvest
16,000 immediately eligible
7,000 will become eligible
TOTAL eligible discount £1.3bn
If just 5% buy
£72m discount to be reimbursed.
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‘Pay to Stay’
Income over £30k
Level of rents awaiting regulation
Limited households eligible
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Funding Impact on Development Programme
HCA prospectus
Emphasis on shared ownership
Limited Rent to Buy
How do we deliver affordable rent?
Reduced S106
Own resources
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50
100
150
200
250
300
350
400
450
500
16/17 17/18 18/19 19/20 20/21
Forecast Future Programme
rent
LCHO
Market rent
PRS
TOTAL