A Housing Today investigation has discovered many RSL development staff find it difficult to work the quango's grant rate calculator, despite it being in its third incarnation. A combination of the new rent regime and "bizarre" corporation assumptions on costings for new projects place family housing schemes and new-build through the Approved Development Programme under threat, they say.
The development director of one northern RSL told Housing Today: "We have run a few options through the calculator and the problems we have are with new-builds in general.
"Specifically, new-build family accommodation is just not stacking up economically and there is not a viable relationship between target and prospective rents; if we go for target rent, we get a little more grant rate but not enough to make the schemes work.
"The assumptions made in the corporation's calculator don't bear any resemblance to reality for this association."
Northern Counties Housing Association has announced that it is to restructure commitment to its social housing development programme from as much as 1,000 homes a year to around 100.
Chief executive Ken Irving said: "The introduction of rent restructuring from next April, together with insufficient grant for providing additional homes, means that new development on such a large scale will be increasingly difficult to justify."
A member of a BME association's development team also cast doubt on the future of its building plans.
"Things are bad in terms of family housing and we are very worried about it," she said.
"One would have expected to see grants improving but that is just not the case – they are prohibitive. There have been very bad delays, no training offered whatsoever from the Housing Corporation and we are finding the whole business of valuation extremely complicated."
Home Housing Association also sees a threat to its new family developments. The association's development manager Jed Walsh is preparing to submit 80 bids for ADP cash.
"It doesn't look good for new family housing," he said. "It will be very expensive for us, meaning we will have to put a lot of our own money into schemes – that could mean some developments don't make it.
"Associations will not have the incentive or ability to provide family accommodation in either high or low valuation areas and if they wish to be involved in regeneration, associations will be cautious about taking a risk with a scheme that doesn't stack up."
A corporation spokesperson said: "We have had anecdotal evidence of this issue, but we would need hard evidence in order to consider the matter. Housing associations should approach us. Clearly, the government's rent policy had to be factored into the new grant rate scheme."
Source
Housing Today
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