Plymouth City Council commissioned this study to establish whether other councils, which face similar viability challenges, are successfully using additional delivery instruments or mechanisms that could be adopted by them to increase affordable housing delivery.
At a glance
Housing Advisers Programme case study
2022/23 cohort
Executive summary
Plymouth City Council (PCC) and its affordable housing partners have historically been strong at delivering affordable housing numbers in the city. Since the pandemic however delivery has slowed significantly due to a number of factors, including local viability challenges.
PCC therefore commissioned this study to establish whether other councils, which face similar viability challenges, are successfully using additional delivery instruments or mechanisms that could be adopted by PCC to increase affordable housing delivery. Whilst the consultants identified that PCC is already utilizing most instruments to increase affordable housing delivery, they identified three areas which PCC could explore further to increase affordable housing in the future.
The instruments identified by the consultants are as follows:
- establishing of a development company
- making more use of Joint Ventures;
- establishing a Direct Delivery Programme.
PCC will now investigate the deliverability of these instruments to increase the delivery of affordable housing in Plymouth in more detail.
Challenge and context
PCC in partnership with locally active affordable housing providers has historically over delivered on the Joint Local Plan (JLP) housing targets, by using various different instruments, partnerships and strategic plans to maintain delivery.
COVID-19, Brexit, and inflation impacts have created an unprecedented accumulation of challenges making it increasingly financially unviable to build new affordable homes in Plymouth.
Plymouth’s comparatively low sales values mean that it is particularly affected by rising build costs, labour shortages and new building regulations and planning policies aimed at increasing the energy efficiency of new homes or boosting biodiversity on new sites. Furthermore, Plymouth is heavily reliant on brownfield land for housing delivery whilst neighbouring authorities possess many high value greenfield sites with greater demand.
As a result of the combination of these factors, just 50 affordable homes were delivered in Plymouth during 2021/2022. This has fallen significantly from an annual average of 268 affordable homes per annum in the pre-pandemic years of 2015/16 to 2019/20. PCC has therefore struggled to meet the growing demand for affordable housing, and consequently, homelessness, rough sleeping and the need for temporary accommodation are rapidly rising. The Housing Delivery Team therefore wanted to ensure that no instruments to deliver affordable housing were missed to ensure the delivery of the highest number of affordable housing possible.
What we did
PCC employed the Three Dragons Consultancy to identify whether there were other measures that could help to deliver more affordable housing in the city despite the challenges.
The consultants used qualitative and quantitative data methods to assess housing delivery strategies and policies in a number of comparable localities within the UK - to highlight demonstrable impacts on increased housing delivery and to determine whether respective approaches could be replicated in Plymouth.
The research established that PCC is already utilising many effective approaches to support the delivery of affordable housing and that it is important that these programs and initiatives are continued, despite the recent downturn in delivery numbers. The importance of the well-established Plymouth Housing Development Partnership – a partnership with all actively developing affordable housing providers in Plymouth – was also stressed.
In addition to the above, the consultants identified three other approaches which could be further developed by PCC to increase delivery in addition to a number of smaller-scale mechanisms. The main delivery options identified were:
- establishing of a development company
- making more use of Joint Ventures
- establishing a Direct Delivery Programme.
The research highlights the opportunities and challenges in relation to the above delivery options.
It concludes that to guarantee the highest delivery number for affordable housing, it is essential to employ a wide range of instruments and initiatives and to not rely too heavily on just one or two. It also stresses the importance of establishing relationships with other local authorities in similar situations to ensure the continued exchange of information and ideas.
The difference we made
PCC is looking to further explore the alternative delivery proposals suggested by the consultants to increase affordable housing delivery in more detail. This will however take some time due to the complexity of the identified approaches.
There are currently over 7,700 households registered on the Devon Home Choice housing register and Plymouth is facing record numbers of households in emergency accommodation. It is hoped that whichever instruments are implemented, these will help to reduce the cost of emergency accommodation and could possibly also contribute to income generation for the council.
Lessons learned
PCC’s current approach to affordable housing delivery is well regarded by its developer partners and is quite comprehensive. Despite recent reductions in delivery numbers the consultants outlined the importance of continuing this approach.
The research has helped to clarify, that there are no ‘magic strategies’ or innovative strategies which will easily resolve the affordable housing delivery challenges in the city by themselves.
There are however some well established mechanisms available - some of which PCC has previously used to deliver affordable housing - that could be utilised more extensively to help deliver more affordable housing in the city.
The ‘secret to success’ is to use a combination of different approaches to improve affordable housing delivery rates in the city.