Agenda item

That the following grant funding payments for affordable housing developments in the Borough be approved:

1. £812,233 to Watford Community Housing Trustfor a development known as Goldcroft garage site, Hemel Hempstead. 

2. £1,417,000 to Thrive Homes for a site known as land off Two Waters Road, Hemel Hempstead. (Old Hewden Hire site)

3. £133,168 to Hastoe Housing Associationfor a development known as garage site adjacent to 28 & 30 West Dene, Gaddesden Row, Great Gaddesden.

4. Approve the purchase of the site known as Garages to the South of 71 – 81 Burns Drive, Hemel Hempstead for a sum of £495,000. Agree an additional expenditure of £100,000 for consultant fees to deliver the scheme on this site.

Decision

That the following grant funding payments for affordable housing developments in the Borough be approved:

1. £812,233 to Watford Community Housing Trustfor a development known as Goldcroft garage site, Hemel Hempstead. 

2. £1,417,000 to Thrive Homesfor a site known as land off Two Waters Road, Hemel Hempstead. (Old Hewden Hire site)

3. £133,168 to Hastoe Housing Associationfor a development known as garage site adjacent to 28 & 30 West Dene, Gaddesden Row, Great Gaddesden.

4. Approve the purchase of the site known as Garages to the South of 71 – 81 Burns Drive, Hemel Hempstead for a sum of £495,000. Agree an additional expenditure of £100,000 for consultant fees to deliver the scheme on this site.

Reason for decision

To seek approval for the payment of “one for one” grant funding to Housing Associations (Registered Providers) delivering affordable housing schemes in the Borough.To seek approval for the payment of “one for one” grant funding to Housing Associations (Registered Providers) delivering affordable housing schemes in the Borough.

In addition seek approval to purchase a site known as Garages to the South of 71 - 81 Burns Drive for the purposes of building Council homes and commit expenditure to developing the scheme to build out.

Corporate objectives

Delivering Affordable Housing.

Deputy Monitoring Officer/Deputy S.151 Officer Comments

Deputy Monitoring Officer: Under the scheme introduced in 2012 investment in new affordable housing can be made by the Council itself or through grant funding registered providers.  This decision proposes funding developments by Watford Community Housing Trust, Thrive Homes and Hastoe Housing Association.  Officers should ensure that each grant going forward is covered by the grant agreement (referred to in para 5 below) to ensure that the Council’s position is protected and enable it to meet audit requirements. In relation to the purchase of the garage site, the final terms of the purchase contract must be reviewed by the Legal Team prior to completion. 

Deputy S.151 Officer: The award of these grants can be met from the 1-4-1 receipts and will be reported on the pooling return to CLG which is audited on an annual basis by DBC’s appointed external auditors. The grant agreement protects the Council from the payment of any interest penalties charged for late delivery of schemes. The purchase of the site identified can be met from within existing approved capital budgets.

Advice

Councillor Griffiths introduced the report. She explained this deal was to use receipts for further development instead of sending the money back to central government. 75% of subsequent lettings will be available for immediate rent from people on the registered housing list, have a local connection or have served in the armed forces. If they have not been let after four weeks, then they may be offered to others.

E Brooks introduced D Barrett who was the new group manager for Housing Development. He explained that there was an allocation of three grants and a purchase of a piece of land to develop new homes – a third of the purchase can be funded by one to one receipts.

Councillor Marshall asked what the Housing Associations got out of the deal.

E Brooks said they get a new development, a third of the total cost contributed to the cost of land and development and they receive more income due to an increased stock.

M Gaynor added that the HCA provide grants in certain circumstances but they are relatively low. The cost of borrowing is reduced for the Housing Associations. In the future, the Council are hoping to secure a further deal so that it also sees the benefits of the deal. One area that the Council hopes to push is achieving social rents instead of affordable rents.

Councillor Williams said this would appeal to housing associations outside the borough as they might have limited development opportunities in their area.

Councillor Douris said as he was Chair of the Herts Armed Forces, he recognised the nomination rights they would receive.

Councillor Griffiths said this was already in the housing policy after signing the covenant

Councillor Williams referred to the nomination rights and said he couldn’t see there being an issue with letting units within four weeks.

E Brooks said they are discussing in advance what is needed and the majority will be two bedroom houses.

Councillor Williams asked if the proposed properties will have disabled access.

E Brooks said there was currently a short supply of fully adapted properties. These properties are relatively easy to let but the affordable rents put people off. Further down the line, the next stage is to influence lower rents.

Councillor Williams said the next grant should ensure social rents.

M Gaynor said yes, they could and should and this should link with the commitments that they Housing Associations have made. The Council should get its objectives which could be achieved through higher grants – a reduction below 80% of market rent is a key priority.