Stroud District Council has a proactive enabling approach to tackle the housing issues in a growing and attractive rural district made up of many villages and small towns.
Stroud District Council has a proactive enabling approach to tackle the housing issues in a growing and attractive rural district made up of many villages and small towns. An important part of the strategy is a council housebuilding programme that has delivered over 220 new homes in the last few years. However, the council has now reached its borrowing cap. Nevertheless, it believes that it can make a strong case based on its performance for a successful bid for the Government’s current programme for lifting the borrowing cap.
Context
Stroud is a rural district in Gloucestershire covering 175 square miles – half of which is in the Cotswolds Area of Outstanding Natural Beauty. The population is nearly 113,000, comprising 49,000 households. The population grew by over 3,000 in the first decade of this century. Affordability of housing is a major challenge. According to the National Housing Federation’s ‘Home truths’ report for the South West (2018), average house prices in the district were nearly £290,000 and the ratio of mean house prices to mean household incomes was over 10:1.
The local housing strategy has four priorities – one of which is “to deliver affordable housing to meet the needs of local communities”. The local authority has a stock of over 5,200 council houses. It has a waiting list of nearly 2,300 households. Stroud District Council has an effective and strong enabling function. It works positively with housing associations and has an excellent track record of supporting private sector housing development through the planning process. It has, over the last few years, granted planning permission for nearly 6,000 houses. However, it is aware that not all of the sites with planning permission are progressing as quickly as had been hoped.
The council has also been active in the more rural parts of the district in imposing restrictions on the resale of properties sold under right to buy (RTB) (through section 157 of the Housing Act, 1985).
Council housebuilding
By the end of 2017/18 the council had delivered 226 new council homes, with a further 25 new homes due to start in 2018/19. The sites have included some large regeneration projects where non-traditional precast reinforced concrete (PRC) properties, that have reached the end of their economic life, have been demolished and replaced with mixed tenure homes comprising a range of property types, with a particular emphasis on one and two bedroom properties to fill a gap in the housing development market (as other developers have concentrated on larger family homes).
The majority of the properties have been built for affordable rent. However, the council has also developed a number of properties for shared ownership, enabling those people who are unable to afford to purchase a property outright to get a first step on the housing ladder by purchasing a share of between 25 and 75 per cent. These have proved very popular and further shared ownership homes are planned for this year.
Grants have been received from Homes England and receipts from the sales of RTBs have also been used to subsidise the programme.
The new homes have been built to high standards – ‘Stroud new build standard’:
• energy efficiency and environmental sustainability (including, where appropriate, renewable energy products such as photo-voltaic cells) to address issues of fuel poverty and following a ‘fabric first’ approach to thermal insulation
• lifetime homes standards so that properties can meet the needs of households as their needs change.
Stroud District Council hopes that this standard will be an exemplar for other developers in the area to ‘future proof’ new housing schemes.
The council also has a sheltered housing modernisation project to ensure that its stock of 29 sheltered housing schemes is sustainable into the future. This programme has included the closure of some schemes that are no longer fit for purpose, with the proceeds being used to help fund the development of new purpose-built accommodation for older people, including flats with scooter stores, lifts and wet rooms and the provision of shared ownership bungalows for older people.
The local MP, Dr David Drew, raised the issue of local authority housing in an adjournment debate in the House of Commons in December 2017.
Challenges
There are a number of interrelated challenges. The most significant of these is that Stroud District Council has reached its borrowing cap. In addition, there is a desperate need for social housing because of the shortfall in affordable housing. This is compounded by the rent levels in the private sector. The local housing allowance area for Stroud is based on Gloucester, which is a relatively lower rent area. There is, thus, an issue of high rents in the private sector not matched by housing benefits, leading to affordability problems and households seeking social housing.
Although the council has invested over £25 million through the HRA over the last six years to ensure the existing stock continues to meet the decent homes standard, this will be an ongoing issue. Difficult decisions, therefore, have to be made on the relative properties of modernising the existing homes and building new council properties.
Opportunities
The council and the local MP are optimistic that a strong case can be made to the Government in bidding for lifting the HRA borrowing cap from 2019/20 to 2021/22 because of the high affordability pressures in the area. It also has a number of potential schemes that can be developed quickly, which is likely to be one of the criterion for a successful bid. It continues to robustly analyse its land and property assets to identify future sites for council housebuilding.
In addition, there is a strong campaign to tackle the issue of RTB sales. In particular, the local MP has been lobbying the Government to renegotiate the amount of money that goes back to the Treasury when a property is sold, from 70 per cent to a much more realistic figure, in order to boost replacements through council housebuilding.