what does the act mean for development the orbit perspective support/eastern resources/maggie... ·...
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What does the Act mean for development
The ORBIT perspective
Maggie McCann (Development Director, Orbit East & South)
ORBIT – Housing Association or Developer
40,000 homes
> 1,700 new homes all tenures in 16/17
Completing 2,000 per annum to 2020
2nd largest development pipeline
Up to 350 market sale pa
Growing PRS
0
50
100
150
200
250
09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17 Fcst
East Region Completions
Rent
LCHO
Market sale
Overview
Starter Homes
Right to Buy
Permission in principle
“Pay to Stay”
Housing and Planning Act 2016 - Starter Homes
Minimum 20% Discount ?
Applies to sites over 10 homes
Can be commuted off site
Secured by S106
Takes precedence over other
affordable
EXEMPTIONS
Viability
PRS – off site
Specialist Housing
Affordable led and Regeneration sites ?
Rural
Are Starter Homes Competing with
other sale options?
Rent to Buy
Shared Ownership Shared Equity
Will Starter Homes squeeze out other affordable?
Replaces other tenures in S106 (20%)
Developer builds and sells
5 -10% other affordable tenures
Reduces Orbit programme by 100 per annum (in East)
560 reduction pa nationally
Starter Homes - opportunity
Can we deliver the Starter Homes
Experience of marketing and selling to similar clients
Help to differentiate the product from market sale
Developer needs the cashflow and pre-sales from RP
Why would we want to?
Economies of scale of marketing with Shared ownership?
Buy them at the right discount improve our profits – marginal
On our own market sites we will assess in same way as developers
Housing Planning Act 2016 – Voluntary RTB
Sell the Home
How many?
How much for ?
When do we get reimbursed?
Build the replacement
Where?
What tenure?
Can planning help?
Housing Planning Act 2016 – Voluntary RTB
ORBIT NUMBERS
3,000 existing preserved RTB
39 RTB sales in 2014/15 = £1m profit to reinvest
16,000 immediately eligible
7,000 will become eligible
TOTAL eligible discount £1.3bn
If just 5% buy
£72m discount to be reimbursed.
‘Pay to Stay’
Income over £30k
Level of rents awaiting regulation
Limited households eligible
Funding Impact on Development Programme
HCA prospectus
Emphasis on shared ownership
Limited Rent to Buy
How do we deliver affordable rent?
Reduced S106
Own resources
0
50
100
150
200
250
300
350
400
450
500
16/17 17/18 18/19 19/20 20/21
Forecast Future Programme
rent
LCHO
Market rent
PRS
TOTAL
