Croydon Affordable Housing Policy

Croydon adopted their Local Plan in February 2018 to ‘enable increasing the supply of homes through sustainable growth (together with affordable homes)’.

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Policy SP2.3, SP2.4 and SP2.5 of the Local Plan set out the expectations regarding affordable housing in the borough, this can be seen below:

Affordable Homes SP2.3 The Council will seek to ensure that a choice of homes is available in the borough that will contribute to addressing the borough’s need for affordable homes. This will be achieved by a strategic policy target of: a. 25% of all new homes developed in the borough over the plan period to be either affordable rented homes (homes which are up to 80% market rent) or homes for social rent to meet the borough’s need; and b. 15% of all new homes in the borough developed over the plan period to be intermediate affordable housing for starter homes, low cost shared home ownership managed by a Registered Social Landlord or intermediate rent.

SP2.4 To deliver affordable housing in the borough, on sites of ten or more dwellings the Council will: a. Negotiate to achieve up to 50% affordable housing, subject to viability; b. Seek a 60:40 ratio between affordable rented homes and intermediate (including starter) homes unless there is agreement between Croydon Council and a Registered Provider that a different tenure split is justified and subject to national regulations on provision of starter homes or, on schemes which are covenanted Private Rental Schemes where the 60:40 ratio is not viable?; and; c. Require a minimum provision of affordable housing as set out in SP2.5. SP2.5 The Council will require a minimum provision of affordable housing to be provided either: a. Preferably as a minimum level of 30% affordable housing on the same site as the proposed development or, if 30% on site provision is not viable; b. If the site is in the Croydon Opportunity Area or a District Centre, as a minimum level of 15% affordable housing on the same site as the proposed development plus the simultaneous delivery of the equivalent of 15% affordable housing on a donor site with a prior planning permission in addition to that site's own requirement. If the site is in the Croydon Opportunity Area, the donor site must be located within either the Croydon Opportunity Area or one of the neighbouring Places of Addiscombe, Broad Green & Selhurst, South Croydon or Waddon. If the site is in a District Centre, the donor site must be located within the same Place as the District Centre; or c. As a minimum level of 15% affordable housing on the same site as the proposed development, plus a Review Mechanism entered into for the remaining affordable housing (up to the equivalent of 50% overall provision through a commuted sum based on a review of actual sales values and build costs of completed units) provided 30% on-site provision is not viable, construction costs are not in the upper quartile and, in the case of developments in the Croydon Opportunity Area or District Centres, there is no suitable donor site. In assessing viability, the Council will compare Residual Land Value with Existing Use Value (plus an incentive to provide a competitive return to a willing landowner) or Alternative Use value if there is an alternative use for the site which would comply with the policies of the development plan and could be implemented10; will take account of features which appear to seek to exclude affordable housing by design or by incurring upper quartile construction costs11; and will take account of abnormal costs incurred. SP2.6 The Council will only accept in exceptional circumstances commuted sums on sites with ten or more units in lieu of on-site provision of affordable housing (or provision on a donor site) if it is not possible to find a Registered Provider to manage the on-site affordable homes.

As seen above, there are different requirements based on whether the development has the ability to provide on-site provisions.

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On all developments of 10+ dwellings, up to 50% of the proposed units are wanted as affordable housing, with a minimum of 30% on site.

However, if 30% of the affordable dwellings cannot be provided on the development site, then there are two other options.

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The first option would be to provide 15% of the units on-site as affordable if in the Croydon Opportunity Area or a District Centre and then have the other 15% of units on a donor site that already has been granted planning permission. The alternative option is to have 15% affordable dwellings on-site, and then have a late review mechanism carried out to determine if there is any further surplus for affordable housing.

The option of commuted sums in lieu of on-site affordable housing is highlighted in SP2.6, where it states that only in exceptional circumstances will this option be available for sites of 10+ dwellings.

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However all of the above ambitions are caveated by viability. The concluding paragraph of SP2.5 is particularly detailed in this regard.

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S106 Management have completed many viability challenges in Croydon. We advise that a site-specific viability assessment is completed on all developments of 10+ dwellings in Croydon.

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Previous Work in Croydon

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Proposed development = Demolish the existing dwellings and erect a 4 -storey residential block in its place; in total the development will provide 22 flats with a combined GIA of 1,569m2.

Policy implications/requirement = On developments of 10+ dwellings, 50% are wanted to be affordable; however, the minimum requirement is 30%.

Expectation on Affordable Housing = In this instance, 30% of the 22 flats are required as affordable housing, this equates to 6.6 units.

Result = The site was deemed unviable if it were to provide the targeted number of on-site units. A variety of minimal S106 contributions were agreed and planning was granted.

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Croydon Affordable Housing Policy

Previous Work in Croydon

Brentwood Borough Council Adopt CIL Charging Schedule

Dacorum Affordable Housing Policy

Grey Belt – New Opportunities, Rules and Submission Requirements