Tue Nov 22, 2016 8:10 pm
One thing I noticed looking at the planning docs is another is that yet again, Cardiff City Council have been brow-beaten in to reducing the S106 contribution, especially for housing, because of "viability" issues.
The Policy is for 20% of homes to be affordable - quite a lot lower than in much of England (although, admittedly, property is cheaper than Cardiff than much of England). That would have equated to 30 properties on or off-site, or about a £2 million contribution to the council. The developers (JR Smart) have gotten a consultancy to "prove" that such a contribution would have made the scheme unviable. Instead, they have to pay about £500,000 for housing, which would be about a 5% affordable contribution.
The whole problem is the ability to negotiate here. If these contributions were fixed in stone, everyone would know they would have to pay them. That would mean that if they wanted to be sure of making a profitable development, the developer would be willing to pay the initial landowner less for the site. So it would be the initial landowner who would bear the cost, not the developer. Higher affordable provision would be "viable" because land prices would be lower.
As it stands, developers know they can negotiate down these contributions so end up bidding up land prices more than they otherwise would. So poorer residents (and the taxpayer subsidising private sector rents or temp accomodation) suffer.. while landowners get higher prices for their land.