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Hundreds of new homes built in Croydon could be let at 65% the market rate to make them affordable

Hundreds of new homes built in Croydon could be let at 65% the market rate to make them affordable
Jun 15, 2017 Shaking Hands 0 comments
This post was first published by Croydon Advertiser on 14/06/2017.

Hundreds of new homes built in Croydon could be let at 65% the market rate to make them affordable

Hundreds of new homes built in the borough could be let at rents well below market rate under Croydon Council plans to make properties “genuinely affordable“.

The council wants to set up a Limited Liability Partnership (LLP) to administer some 340 affordable rented homes that will be built as part of its plans to build 1,000 new homes across the borough through development company Brick by Brick.

The arrangement would also be in place for some of the homes built on the site of the former Taberner House council headquarters in Queen’s Gardens, by developer HUB.

The council says the 340 homes will be “genuinely affordable” through being let at just 65% of the market rate.

The legal definition of affordable housing means homes from private developers is let at 80% of the market rate. But with rents in Croydon well above the UK average, even a 20% discount can leave many flats and houses unaffordable to those on lower incomes, benefits, or who live alone.

Because the average rent for a two-bedroom property in Croydon is £1,200 per month, while the Local Housing Allowing (LHA) – the housing benefit – is just £900, families on benefits face a £300 a month shortfall.

At 65%, the rent for a £1,200 per month property would be £780 instead.

Also, low income workers have been hit after the average rent in the borough has increased by a third since 2005, while nationally, wage growth has barely kept pace with inflation.

In an effort to help tackle the problem, the council says the LLP – provisionally called Croydon Homes – will independently set rent levels, and give priority to local people “in most housing need”.

The council also says the arrangement will help save £1.4million on the cost of temporarily accommodating homeless families.

Councillor Alison Butler, the council’s cabinet member for homes, regeneration and planning, said: “Rents and demand for private homes in Croydon are continuing to rise out of people’s reach, so this council is taking action to guarantee genuinely affordable social rented housing for hundreds of local families.”

The plans brought forward by the council’s ruling Labour administration are due to be considered at a cabinet meeting on Monday, June 19.

If approval is granted, the council says it will set up Croydon Homes later this year ready for when Brick by Brick starts building the first 151 affordable homes on sites across the borough in 2018.

The remainder of the 340 homes include 93 units in the 514-flat redevelopment of Taberner House and 93 existing properties the council uses for temporary accommodation.

The council’s plans to build the 1,000 homes with Brick by Brick have not been uncontroversial.

Groups of angry residents have protested plans to build homes on the Tollers Estate in Old Coulsdon and at Auckland Rise in Upper Norwood, who have accused the council of overdevelopment.

The protests against some of the developments have been taken up by Croydon Conservatives, who have also accused the council of being secretive over a list of planned sites for Brick by Brick developments last year.