Final Economic Viability Report September 2009 - pdf

40% affordable housing could be viably delivered at a 50/50 split between social rented and intermediate
tenures on 81% of the scenarios tested and indeed 50% affordable housing split 50/50 social rented
intermediate could also be delivered on 71% of the scenarios tested.
This report concludes that, in isolation, site density and tenure split have a limited effect on the level of
affordable housing that was sustainable on the hypothetical sites tested. Land value, on the other hand is a
very significant factor in determining affordable housing viability. Increases in build rates also have a
significant positive impact on the viability of schemes as shortening the timeframes for a development derisks
and reduces costs.
The Local Authority’s current affordable housing target of 40% is ambitious in the current market and
certainly in the short to medium term until the market recovers. Without social housing grant to contribute,
affordable housing delivery at these levels will make schemes unviable for standard Section 106 sites.
However, with grant and additional revenue in these scenarios, these levels may be deliverable. The results
of our modelling work has determined that the percentage of affordable housing requested by the Local
Authority over the coming years will have to be flexible and potentially alter to reflect prevailing market
conditions in order to ensure that the optimum level of affordable housing is delivered across the plan
period. The conclusion of this report provides ranges and indications of what market conditions would have
to be in place to deliver higher percentages of affordable housing.
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