Sustainable communities in Thames Gateway under threat

The future of high-density, mixed tenure developments in the Thames Gateway could be jeopardised if service charges for affordable housing tenants are not reduced, the government has been warned.

The finding comes in a report by consultant Hacas Chapman Hendy due to be published at next week’s Thames Gateway Forum.

The report, commissioned by Moat Housing Group, London & Quadrant Housing Trust and Ujima Housing Association, calls on the ODPM to take the lead in determining the extent to which service charges should be limited and subsidised for affordable rented housing.

It raises concerns that if this is not done, the planned 200,000 homes in the Thames Gateway may not be viable for either social tenants or private leaseholders.

The report, What Price Sustainability, also states that, currently, affordable housing residents receive lower levels of service than private residents.

But if tenants do receive the same services, it is often more than they can afford. In one London case study, rent together with service charge costs account for over 30% of the overall income of lowest-earning families.

Furthermore, the flat-rate housing allowance proposed as part of the government’s housing benefit reforms would exacerbate affordability problems if linked to target rents set by the ODPM because they do not include service charges. Social housing tenants are, therefore, likely to refuse to accept tenancies on high-density estates because they would have to pay a service charge to live there.

The report says that prospective tenants of the planned high-density developments in the Thames Gateway would have more incentive to seek out social rented accommodation where there was no service charge.

It concludes this would increase the chances of estates being built that housed few social housing tenants and were made up primarily of private tenants and owner-occupiers.

In a worst-case scenario, housing associations could also be left with empty properties on their hands.

The report puts forward a number of proposals to address the problem, including developers subsidising service costs through the planning gain system and local authorities paying subsidies to limit charges.

A spokesman for Moat Housing Group said: “Planning officers need to think about the end users when they commission these high-density developments. We may have got better at creating environmental sustainability, but we still have some way to go with creating social and economic sustainable communities.”