Issue - meetings

The Housing Development and Enabling Manager presented a report on the proposed revocation of the First Homes Policy.

Members were advised that the Government had introduced an affordable housing product, known as First Homes, which all local housing authorities had been required to provide from 28th March 2022 as 25 per cent of affordable housing on Section 106 sites. These homes were required to be sold at a discount of at least 30 per cent against open?market value.

It was reported that First Homes had become increasingly expensive due to rising new?build house prices, meaning that they were often unaffordable for local residents. Members were informed that shared ownership properties offered a more accessible route into affordable home ownership for residents.

Officers explained that meetings had taken place with several Registered Providers, who had indicated that reducing the proportion of shared ownership units in favour of First Homes compromised the viability of Section 106 sites.

In terms of operational issues, Members were advised that administering the First Homes scheme placed a significant burden on local authorities, as it required detailed processing and approval of applications from prospective purchasers. Removing the requirement for First Homes would therefore reduce this administrative burden.

Regarding financial implications, the Committee was informed that while Councils charged £508 for administering variations to Section 106 agreements, this cost would be offset by the developer not having to obtain valuation reports for First Homes properties from a RICS?qualified valuer.

Officers advised that revoking the First Homes Policy would support residents on lower incomes in accessing affordable home ownership and strengthen the viability of Section 106 sites for Registered Providers.

The Portfolio Holder for Housing thanked the Housing Development and Enabling Manager for the report. He highlighted that none of the sites with First Homes requirements had yet been built out and, as a result, no First Homes properties had been sold. He stated that revoking the policy would be a positive step to help lower?income households onto the housing ladder while also reducing the administrative demands placed on officers. It was hoped that developers would welcome the change, as it would make sites more viable and ultimately lead to the delivery of more homes for residents.

Members commented that they were keen to see more effective use of Section 106 agreements.

RESOLVED that:-

1) the Council’s First Homes Policy be revoked with immediate effect;

2) and that any development sites that currently include an element of First Homes provision is offered an opportunity to revert to shared ownership and other forms of affordable home ownership.