Housing campaigners back Town Hall’s bid to tackle affordable homes ‘smokescreens’
Council warned that some developers were allowed to ‘game the system’ through misapplying viability assessments
19 October, 2018 — By Emily Finch
Islington Council housing chief Councillor Diarmaid Ward
HOUSING campaigners praised the Town Hall in their push for affordable housing which has prompted a leading professional body to review their guidance for developers.
Islington Council housing chief Councillor Diarmaid Ward wrote an open letter to the Royal Institution of Chartered Surveyors (RICS) earlier this month slamming their current advice as “not fit for purpose”.
The letter, co-signed with London’s Deputy Mayor for Housing and Residential Development, James Murray, took aim at how the guidance allows some housing developers to “game the system” through misapplying viability assessments.
This letter follows on from a High Court case won by Islington Council against developer Parkhurst Road Ltd in May where judge Mr Justice Holgate recommended that RICS should update their guidance from 2012 to “address misunderstandings” around valuation.
Developers use viability assessments as part of their planning application to predict how much profit they can expect to make from their new homes.
James Murray, London’s Deputy Mayor for Housing and Residential Development
The Town Hall, as well as housing campaigners, have argued that these assessments allow developers to build fewer genuinely affordable homes than required by the Mayor of London and the local authority.
Marj May, from campaign group Islington Homes for All, applauded the Town Hall for opposing developers who are unwilling to build the 50 per cent affordable homes as set out by Islington Council planning policy.
She said: “This is definitely a move in the right direction. Viability assessments have indeed been used by developers as smokescreens, enabling them to renege on previous commitments to provide genuinely affordable housing, as part of the planning permissions that they have been awarded.”
She added that the group would continue to push for “wider policy changes that are needed in order to address the housing crisis, providing secure and genuinely affordable social housing for all.”
In response to the open letter from Cllr Ward and Mr Murray, a former Islington Council cabinet member for housing, the Royal Institution of Chartered Surveyors (RICS) confirmed that they are currently reviewing their guidance.
Tony Mulhall, associate director at RICS, said: “RICS is addressing the recent comments published by Mr Justice Holgate including his desire for our guidance to play a central role in this area. Once complete, this will provide greater clarity on the methodology to be adopted by the profession in undertaking viability assessments, within the parameters of the Government’s current policy. We intend to consult on the second stage of our review early in 2019 and, as above, will actively be encouraging broad input from stakeholders.”