Asia markets tentative ahead of Opec meeting

Wednesday 2.30am GMT Overview Markets across Asia were treading cautiously on Wednesday, following mild overnight gains for Wall Street, a weakening of the US dollar and as investors turned their attention to a meeting between Opec members later today. What to watch Oil prices are in focus ahead of Wednesday’s Opec meeting in Vienna. The […]

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Banks, Financial

RBS emerges as biggest failure in tough UK bank stress tests

Royal Bank of Scotland has emerged as the biggest failure in the UK’s annual stress tests, forcing the state-controlled lender to present regulators with a new plan to bolster its capital position by at least £2bn. Barclays and Standard Chartered also failed to meet some of their minimum hurdles in the toughest stress scenario ever […]

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Barclays: life in the old dog yet

Barclays, a former basket case of British banking, is beginning to look inspiringly mediocre. The bank has failed Bank of England stress tests less resoundingly than Royal Bank of Scotland. Investors believe its assets are worth only 10 per cent less than their book value, judging from the share price. Although Barclays’s legal team have […]

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Currencies, Equities

Scary movie sequel beckons for eurozone markets

Just as horror movies can spook fright nerds more than they expect, so political risk is sparking heightened levels of anxiety among seasoned investors. Investors caught out by Brexit and Donald Trump are making better preparations for political risk in Europe, plotting a route to the exit door if the unfolding story of French, German […]

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Dollar rises as markets turn eyes to Opec

European bourses are mirroring a tentative Asia session as the dollar continues to be supported by better US economic data and investors turn their attention to a meeting between Opec members. Sentiment is underpinned by US index futures suggesting the S&P 500 will gain 3 points to 2,207.3 when trading gets under way later in […]

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Categorized | Property

London to offer grants in £3.2bn affordable housing boost

Posted on November 29, 2016

London has said it will spend £3.2bn to build 90,000 affordable homes over six years, with grants of up to £60,000 per council house built by non-profit housing associations.

The Greater London Authority said that there would also be grants of £28,000 to build affordable homes, where either the ownership is shared, or the rent is set at one-third of average earnings.

The target of 90,000 new homes by 2020-21 represents a 48 per cent increase from the number of affordable homes built between 2009-10 and 2014-15.

Property developers that do not include at least 35 per cent of affordable housing in their projects can expect to be “properly interrogated”, said the GLA, as it offered developers the choice between voluntarily raising their affordable housing share or going through a drawn-out planning process.

Last year, 13 per cent of homes granted planning permission were classed as affordable, the GLA said.

James Murray, deputy mayor for housing, said the approach represented the GLA being “ambitious but practical”, seeking a big increase in affordable housing while recognising the limits to its ability to do so.

Sadiq Khan, London’s mayor, is legally unable to introduce a binding target for affordable housing levels until the next version of the London Plan, a citywide rule book, is adopted in late 2019.

Iain Gilbey, property lawyer at Pinsent Masons, said the GLA was going to “apply a great deal of scrutiny to less than 35 per cent affordable housing and a light touch approach to more than 35 per cent”.

Mr Khan has a “long-term strategic target” of achieving 50 per cent affordable housing on new developments. Housing associations receiving grants from the mayor will be expected to deliver 50-60 per cent, with private developers expected to deliver 35 per cent.

Andrew Boff, the Conservative chair of the London Assembly’s housing committee, criticised Mr Khan for his refusal to set a numerical target for the total number of homes built, as opposed to the percentage target for affordable homes.

A rising percentage of affordable homes could obscure a falling number of total homes built, he said, adding that a numerical target would provide a way to judge the mayor’s performance at the next election.

“Every housing problem in London — poor private rented homes, the social hollowing-out of London — comes back to the fact there aren’t enough incentives to build and nothing here addresses that,” Mr Boff said.

The GLA also said it had devised a way of adapting affordable housing requirements to rental homes.