Developers 'Escaping Affordable Housing Rules'

Developers are deliberately paying too much for land to escape affordable housing obligations, the London Assembly planning committee has warned.  In a letter to Boris Johnson, the committee urged the mayor to introduce new rules for the valuation of land and encourage councils to reject applications that do not adhere to planning obligations. The planning committee alleged that some house builders are intentionally paying too much for land, in order to then make a case that the provision of affordable housing is unviable. Under section 106 planning agreements, developers can argue for a lower level of affordable housing in their schemes if they are able to show that meeting the local authority’s required level of affordable housing is unviable. It also expressed concerns that they are “overvaluing their costs and undervaluing the final scheme’s value”. Read more on the London Assembly website.