Northampton Borough Council bought site at above its market value!

Lakeview plans for sheltered housing block

Stack of gold coins

Northampton Defend Council Housing (NDCH) comments… Northampton Borough Council bought the site at above its market value, the property had not been advertised for sale and was an ‘off market’ purchase.

We (NDCH) have a number of concerns and questions that are connected with affordability of the completed accommodation to tenants.

Example: The LHA maxima policy announced in the Autumn Statement and confirmed in DWP written answers last week to apply to ALL social tenants limits the amount ANY social housing tenant can get to the local housing allowance 

Weekly LHA rate for Northampton… December 2015

Shared Accommodation Rate:£66.32 per week

One Bedroom Rate:£100.05 per week

Two Bedrooms Rate:£126.31 per week

Three Bedrooms Rate:£139.84 per week

Four Bedrooms Rate:£187.14 per week

NOTE: LHA rates are frozen until 2020, creating a guarantee of rising rent shortfalls and arrears.

  • Housing Benefit is to be capped at the Local Housing Allowance maxima for social housing tenants as well as private tenants. This means HB for all social tenants (including pensioners) will be capped at the level of housing need, so someone in a 3 bed who only ‘needs’ a 1 bed will have HB capped (thus pensioners will now get bedroom taxed by the back door). No account will be taken of support costs in refuges and hostels, which are already closing.

Norman Adams … December 2015

 

Northampton Borough Council state

Published Wednesday, 23 December 2015

A proposed new sheltered housing scheme on a site at Lakeview in Churchill Avenue is taking a step forward.

A proposed new sheltered housing scheme on a site at Lakeview in Churchill Avenue is taking a step forward with an application to demolish the building that currently stands on the site, clearing the way for the new development.
Northampton Borough Council bought the site earlier this year and is now working with Northampton Partnership Homes to create brand new sheltered accommodation for local people who want to live independently, but require a home and neighbourhood that suits their needs.
If permission to demolish the site is granted following a meeting of Northampton Borough Council Planning Committee in the new year, then Northampton Partnership Homes will move forward with working up a detailed scheme for the development, which will then be submitted for planning permission at a future date.
Cllr Mary Markham, Leader of Northampton Borough Council, said:  “We are committed to providing more social housing and I am very pleased that we are making a significant step forward with this application to demolish the building.
“We are also building 100 homes in Dallington Grange and I am proud that we are able to make these developments and provide the kind of affordable homes that local people want.”

http://www.northampton.gov.uk/news/article/2241/lakeview-plans-for-sheltered-housing-block

 

History:

Cabinet 4th March 2015

The position of the Council, as a neighbouring owner and as strategic housing authority, means that the price able to be agreed may above the market value of the property to other potential buyers. This will be to reflect the strategic importance of the purchase to the Council. The property has not been advertised for sale and this would be an ‘off market’ purchase that would need to be completed swiftly.

3.3 Choices (Options)

3.3.1 The Council could choose not to purchase the property. The opportunity for the Council to re-develop the plot to support wider Council objectives would be lost. The property is situated in a prominent position that is highly visible and might continue, for a number of years, to deteriorate and become even more functionally obsolescent. It may, at appeal, succeed in obtaining planning consent for conversion to residential use that would see the existing structure retained which is likely to provide lesser quality accommodation for potential occupiers. In this situation traffic and other issues may also be exacerbated. It is possible that another private sector developer would seek to acquire thepremises instead, but there can be no certainty of this and in particular of the timing of that.

3.3.2 The Council could choose to purchase the property for re-development. This would offer a number of different opportunities for the Council to bring forward positive development to support housing initiatives. The Council would though have to pay in excess of what other parties may have been willing to pay for it, were the present owners to offer it to the general market for sale with vacant possession and suitable planning permission.

  1. Implications (including financial implications)

4.1 Policy 4.1.1 There are none specifically.

4.2 Resources and Risk

4.2.1 Capital: The purchase of the property would be included in the 2015/16 Housing Revenue Account (HRA) capital program. If the property were to be directly re-developed by the Council for the delivery of housing needs, then a specific business case would need to be made for that use. If the property were to be disposed of subsequently by this Council, subject to intervening movements in the general property market in Northampton, it is unlikely that the full sum provisionally agreed for the property would be recoverable from another purchaser.

4.2.2 Revenue: The property generates no income at present. There would be some limited revenue costs in holding the property post acquisition, pre development. The business case for redevelopment will be drawn up, fully costed and put through the Council’s HRA Business Plan working in conjunction with Northampton Partnership Homes (NPH), taking into account the any potential impact on the Councils’ Asset Management Strategy.

4.2.3. Risk: The Council could be exposed to net holding costs associated with the vacant property. There may be a need to address potential vandalism issues before demolition is completed. It may not be possible to obtain a planning permission for alternative residential accommodation suggested in this report, although the property is located in a predominantly residential area.

4.3 Legal 4.3.1 The Council would need to exercise due diligence in completing any purchase. The acquisition of property at above its market value is within the general powers of competence of the Council, to support its wider objectives.

4.5 Consultees (Internal and External)

4.5.1 The property would remain as it is now for the short term, Ward Councillors, NPH and other consultees would be consulted when more detailed proposals for the re-development of the property were formulated. Local people would be able to comment on any planning application that might be made.

4.6 How the Proposals deliver Priority Outcomes

4.6.1 The assembly of property interests within the Borough is consistent with the Council’s strategy. It would help to bring forward and support development opportunities, which can enhance economic activity, support growth and provide much needed additional housing within the Borough.

 

http://www.northamptonboroughcouncil.com/councillors/documents/s46294/Strategic%20Acquisition%20ofLand%20Buildings%204th%20March%202015%20Public%20docx.pdf

 

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