Reading Affordable Housing Policy

Reading adopted their local plan in November 2019, it is said to ‘guide development in Reading… it will play a decisive role in how the town evolves over the next two decades’.

Regarding their Affordable Housing Policy (H3 of the Local Plan), there are different expectations based on the number of dwellings being created in a development. For those providing 10 or more units, 30% is required to be AH, 5-9 units is a financial contribution equivalent to 20% so that it can be built elsewhere in the borough, and 1-4 units will provide a financial contribution equivalent to 10%.

Usually, 10+ units would be expected to provide the affordable units onsite; however, under exceptional circumstances there could be an opportunity to provide this % of AH as a financial contribution off-site.

According to Reading’s Affordable Housing SPD (March 2021),some developments of 10+ units may find a surrogate site in which they can deliver their affordable housing contributions instead of on the proposed development site. However, it will still be expected to provide the same amount of affordable dwellings as expected beforehand.

This section from the Reading Affordable Housing SPD below shows the basic calculations that the Council will carry out to determine what financial contribution is to be expected from the developers that do not have on-site provisions:

When a development provides a financial contribution, the combined sum of in-lieu payments will be spread across different affordable housing schemes with the whole of Reading. The annual Infrastructure Funding Statement sets out how the financial contributions provided by these developers has been spent. Across 2020-2021 the borough of Reading spend a total of£1.973million of S106 contributions, it was spent on multiple different things ranging from affordable housing, education and transport.

 

Previous Work in Reading

Proposed development = Demolish the existing building and erecting a new building to create 4 X high specification apartments. Proposes a combined GIA of 283m2 of residential accommodation.

Policy implications/requirements = 1-4 dwellings should provide a financial contribution equivalent to delivering 10% of the units as affordable housing off-site.

Expectation on Affordable Housing = 10% results in 0.4 dwellings, Council seeks 5% of GDV, 5% of £1,240,000 (£62,000).

Result = The residual site value was determined to be less than the benchmark land value, therefore resulting in a negative figure and only allowing a profit of 0.56%, which is much lower than the targeted 20%. The contribution towards affordable housing was dismissed as it was not deemed viable.

Please get in touch with us if you have any problems with the Reading Affordable Housing Policy impacting the viability of your development.

[email protected]

01392 840002

Emerging Bristol Affordable Housing Policy VS Adopted
June 5, 2024

Emerging Bristol Affordable Housing Policy VS Adopted

Does your development in Bristol remain viable if the emerging Affordable Housing policy is adopted?
What to do about Biodiversity Net Gain
February 13, 2024

What to do about Biodiversity Net Gain

BNG will apply to most new major development under the Town and Country Planning Act (TCPA) from February 2024 and to small sites from April 2024.
First Homes - What does the latest guidance say?
June 4, 2021

First Homes - What does the latest guidance say?

The First Homes scheme has now been formally launched - but what does it mean for your development?

High Section 106 costs are avoidable

Call us today for a free consultation. Market leader in viability assessment and Section 106 negotiation.

Call us now on
01392 840002
or
Request a call