Covid-19: The Impact on Developers & Affordable Homes

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01 June, 2020

Building, who provide information and intelligence to the construction industry, have reported that developers are calling for planning rules to be loosened due to the coronavirus pandemic, which could affect affordable housing.

The London Property Alliance, real estate representatives, have written to the housing and communities secretary, Robert Jenrick, calling for a 2-year extension to existing planning permissions in order to ensure they don't expire during the current lockdown of the industry. Which seem reasonable; however, they have also called for a re-introduction of flexibilities, which was last seen during the global financial crisis in 2008, that would enable developers to renegotiate s106 obligations such as the provision of affordable housing. This could result in a fall in the number of affordable houses being built.

In the main, the UK housing market is largely unaffordable and inaccessible, whether it be to buy or the ever-increasing rent. A lot of people are living paycheck to paycheck and the risk of them losing their homes if they miss a payment is ever increasing. No one should be at risk of homelessness because they don't have a secure wage.

The pandemic has already had a massive impact on the economy, with it shrinking by 2% in the first quarter, and with staff being furloughed, at risk of redundancy and greater financial hardship being felt by a lot of people, the need for affordable housing is greater than ever. Which is why it is concerning to see such a request. Now is not the time for developers to be trying to increase profits at the expense of those who are most vulnerable and in need.

Registered providers are working hard to provide affordable homes, however, last year there were 37,825 new homes built to be let at discounted rents despite a national housing waiting list of more than 1.1 million households. Given there are already shortages of affordable housing, it is surprising that developers are trying to use the pandemic to potentially further decrease affordable housing stock. Registered providers can actually help the economy by kick-starting the construction sector and provide a boost by helping to get sites open again and can provide a valuable source of work to construction businesses.

In our experience registered providers are always diversifying to find solutions for their community needs and will continue to do as much as they can regardless of the pandemic.

For more information contact Lyndsay Baxter in our Housing & Regeneration department via email or phone on 0333 207 1130. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

Learn more about our Housing & Regeneration department here

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