New look HCA funding new affordable housing David Warburton, Head of Area, HCA 18 March 2011
Contents Policy and economic context HCA s role Affordable housing and the new model HCA in the South West
A new delivery environment Reduced public funding requires innovation and a drive for increased value for money and greater leverage of private investment Land and regeneration public assets crucial for creating a pipeline of our new development opportunities Investment into improving existing stock and regeneration A fresh approach to funding new affordable homes HCA - an investment and enabling agency
Reshaping HCA for our new role Smaller, leaner and more focused on where we can add value Six local area teams: London Midlands North East, Yorkshire and The Humber North West South East and East South West Two corporate directorates: Programmes and enabling Finance, legal, HR, IT and corporate assurance Reduction in running costs and offices
Reshaping HCA for our new role Four South West teams: Somerset, Devon, Exe Authorities, Torbay, Plymouth, Cornwall and Isles of Scilly West of England, Gloucestershire and Oxfordshire Wiltshire, Swindon and Berkshire Bournemouth, Dorset and Poole, Isle of Wight, North Hampshire and PUSH
The HCA role - investment and enabling Central to our new role is combining investment, enabling and land to support delivery of local priorities for housing, regeneration and economic prosperity Investing in new housing and regeneration Proactive enabling support to local partners Utilising surplus public sector land assets and working with government to manage the land and property assets of RDAs Developing the new model for affordable rent with registered housing providers (RPs) Economic regulation of RPs
Local investment planning Local Investment Plans all will be completed with partners by March 2011 HCA is working with 158 local partnerships nationally and has delivered 16 LIPs in South West operational area Aligning investment in housing and regeneration with emerging LEP priorities Engaging RPs in taking forward thematic and spatial priorities Aligning: Investment Land Other funding streams New models and tools, e.g. Developer Partner Panel
HCA funding for affordable housing 2009/10 2010/11 (budget) 2011/15 TOTAL 3.7bn 2.7bn 4.5bn The 2011/15 total covers both funding for existing NAHP commitments and funding the new model, includes mortgage rescue, empty homes and continued provision for Gypsies and Travellers and Places of Change Target of up to 150,000 new affordable homes, including 67,000 from committed programme
A new delivery model More for less Flexibility to generate additional financial capacity to support new supply Offers to cover a four-year period Close collaborative working is key: Providers Local authorities HCA Local priorities shape new supply
Affordable Rent Main element of programme Rents set at up to 80% of market level (service charge inclusive) for that property Up-rated by RPI + 0.5% for duration of tenancy Minimum two-year fixed term, flexibility to offer longer tenancies Allocations and nominations are expected to be unchanged
Other options to meet local needs Affordable home ownership (shared ownership or equity loans) where this is a local priority and offers value for money Funding for social rented housing may be considered in exceptional cases Other programme elements: Mortgage Rescue Homelessness Change Programme Traveller Pitch Funding Empty Homes
Conversions Crucial element to generate sufficient capacity Consider mobility and risk to provider No ring-fencing of capacity but encourage providers to aim to invest in same wide housing market area Primarily to Affordable Rent, but flexibility to convert to shared ownership where appropriate
Good asset management Even more important Where is your stock? What are its characteristics? What legal restrictions? Loan agreements S106s Nomination agreements
Affordable Rent at a local level Affordable Rent delivery has to be aligned with local priorities Land NAHP/ Affordable Rent HCA will assist local delivery with the right mix of: Public land assets Affordable Rent Regulation Aligning public funding streams Local delivery Regulation Aligning public funding
Affordable Rent at a local level Providers must work with local authorities in putting forward packages and developing proposals HCA will seek information on provider discussions with local authorities HCA will work closely with local authorities in investing in new supply HCA will work to deliver LIP priorities
Next steps Local teams work with LAs, Registered Providers and developers to ensure Affordable Rent meets local ambitions and reflects priorities Support around housing, tenancies, lettings and allocations, planning and use of land, as well as New Homes Bonus April: working with RPs on package proposals 3 May: deadline for submission of bids May June: assessment and negotiation of offers June July: national aggregation and analysis of programme w/c 4 July: national decisions on programme July: new programme implementation
Summary Spending review signals a shift in the way housing and regeneration is delivered HCA will invest in housing and enable regeneration Flexible local approach essential for delivery RPs critical to planning and delivery Alignment of need and opportunity, affordable homes programme in South West to be delivered locally All partners have a role to play