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Agenda item

Removal of condition 3 of planning permission C19/0323/11/LL which restricts 2 units out of 8 to affordable units

 

LOCAL MEMBER: Councillor Steve Collings

 

Link to relevant background documents

 

Minutes:

Revoke condition 3 of planning application C19/0323/11/LL which restricted two out of the eight units as affordable units.

 

a)    The Planning Manager elaborated on the background of the application, noting that it had been deferred at the January 2020 Committee in order to receive additional information regarding the rent prices of the residential units to be provided as part of the proposal. The condition was originally imposed as clear and definitive information had not been submitted (specifically the open market price), as part of the previous application for the affordable provision. Following the deferral of the application, information had been submitted by the developer regarding the rent prices and open market valuations of the residential units.  Also, an assessment of the value of the units had been submitted by a company of Chartered Surveyors, based on the requirements of the Red Book (2017).  The open market value of the units would vary from £45,000 to £60,000 and the monthly rent of the units would vary between £425.00 and £475.00, with units 4 and 8 within the development offered at a rent of £425 per month. According to Appendix 4 of SPG:  Affordable Housing, in relation to the prices anticipated for intermediate housing for sale in the Deiniol ward in Bangor (2018), the value of an intermediate house was £67,876, which meant that the proposed units could feasibly be purchased by occupiers on a moderate salary. The Council’s Strategic Housing Unit had confirmed that the valuation of the proposed residential units was lower than the affordable price level (intermediate) for the Deiniol ward in Bangor. 

 

It was noted in the report that consultation had taken place with the Joint Planning Policy Unit in order to receive more information on the rent situation. It confirmed that paragraph 3.3.2 of Supplementary Planning Guidance 'Affordable Housing' (April 2019) stated that householders were expected to pay 25% or less of their gross income on rent for units described as affordable. Although the median income varied between wards, it was explained that the proposal needed to be considered in relation to the median income of Bangor in its entirety. It was explained that a development in one location could meet the demand for housing within a whole city due to the easy and natural movement between wards, and the proximity of wards to each other (it was noted that Pentir ward had been excluded from the figures on the grounds that it included areas outside Bangor). It was reported that the rent of the two affordable units noted at £425 each was affordable in the context of the median Bangor income and the requirements of the SPG and relevant TAN.

 

It was noted that the open market prices of the units were naturally restricted to being affordable due to the nature and scale of the site and the size of the units themselves.  It was stated that if this information had been submitted with the original application, such a condition would not have been imposed as it would not have been necessary to do so to ensure a provision of affordable units, i.e. based on their open market price, they would be affordable in any case.  Reducing the rent would further reduce the value and this would have the potential to make the scheme inviable. Intervention in a low value market development could affect interest and investment from developers which would affect the regeneration of the High Street in Bangor and other centres.

 

b)    A proposal to approve the application in accordance with the recommendation was put forward and seconded.

 

c)    An amendment was proposed and seconded to include a new planning condition that restricted the rent of two of the units to an affordable level for the following reasons:

·         The median income for Deiniol ward was the appropriate figure in order to assess income, rather than the median income of Bangor in its entirety, as the salaries in Deiniol ward were lower.

d)   During the ensuing discussion, the following main observations were made by members:

·         The median income for Deiniol ward was the appropriate figure in order to assess income, rather than the median income of Bangor in its entirety, as the salaries in Deiniol ward were lower. The rent of £425 was not affordable based on the median income of Deiniol ward. It was noted that the rent needed to be £404 to be affordable in Deiniol ward. Attention was drawn to the fact that the selling price of the units was solely based on the Deiniol ward figure, but the figure for Bangor in its entirety was used for the rent, and it was noted that these were the figures which were convenient for the developer.

 

·         Although the officials were thanked for their explanation, there was disagreement in principle with revoking the condition, as it was believed that it went contrary to the affordable housing policy. It was noted that accepting the developer's argument about the viability of affordable housing set an unacceptable precedent and therefore the developer should have to follow the policy. A question was asked about the use of officers’ discretion not to adhere to the affordable housing policy, and concern was expressed that revoking the condition would be too favourable towards the developer's economic arguments. It was added that this problem arose on both extremes, whether it was an expensive or inexpensive development. Reference was made to past planning applications that had been granted in favour of the developer due to viability arguments, to the detriment of affordable housing. It was felt that members needed to support the affordable housing policy, and to retain the condition, as this was what was important to local people.

 

·         It was noted that the units were already affordable, and that the developer would win the case on appeal.

 

·         Disagreement was voiced with the fact that the units could be referred to as being affordable in perpetuity, as it was impossible to predict future economic and social changes.

e)    In response to the members’ observations, it was explained that arguments about the viability of expensive and inexpensive developments were two separate arguments, and that the affordable housing contribution was always made, but that it was sometimes in the form of a financial sum. It was noted that the affordable housing policy also acknowledged specific circumstances where it was not possible, or not required, to secure a percentage of affordable units, and that this application was such an example. It was emphasised that the clear and robust evidence in the report demonstrated that the market ensured that the units and rent would be affordable in any case, without any further control or intervention by means of a planning condition, and therefore no affordable units would be lost by abolishing the condition. Reducing the rent would further reduce the value and this would have the potential to make the scheme unviable. It was explained that if members were not convinced that the rent would be affordable, clear evidence would have to be submitted to support this. Following a thorough assessment in the report, it was explained that it was not likely that placing a condition to restrict the rent would meet the validity criteria for planning conditions as it was not necessary or reasonable.

 

RESOLVED in favour of the amendment to impose a new condition to restrict the rent of two of the units to ensure that it was an affordable rent level.

 

1.      Need to comply with the remaining conditions of planning permission number C19/0323/11/LL.

 

 

Supporting documents: