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05:47 GMT, Tuesday, 24 June 2008 06:47 UK

How can 6,500 homes be built?

Building site (generic)

The Essex review is expected to say if 6,500 affordable homes are to be delivered, everyone involved in the house building process must work better together.

So how will housing associations, local councils and the assembly government work to build so many new homes?

Q: How will housing associations be able to help?

A: At the moment, housing associations are working under a huge number of rules and regulations about what they can and cannot do.

In terms of their freedom to act independently, they are what has been described as being "micro-managed" by the Welsh Assembly Government.

For example, before they can buy land for development, they have to get government approval.

But the most crucial change likely to be recommended by Ms Essex will be relaxing the rules on how much money they are allowed to borrow.

If they are allowed to borrow money against their existing stock, it could free up more than £100m for the sector. This can then be used to build affordable homes - and the money gained from selling them on can then be reinvested.

At the moment, they can only borrow what they can pay back from their income in rents etc - which limits the money they have to spend on any house building programme.

Essentially, they will be allowed to take more risks, for potentially much greater rewards.

Q: What will councils have to do to create more affordable homes?

A: Councils need to free up land for development and set targets for the numbers of affordable houses to be built in their areas.

One of the key means of doing this will be so-called Section 106 agreements with developers, called planning gain - or, more informally, quid pro quo.

If a developer wants to build a number of expensive executive homes, councils should only give consent if they also agree to build a set number of affordable houses as well.

This already happens, but Ms Essex is likely to recommend councils are tougher and more streetwise about it.

There will also be a recommendation for more empty homes to be used.

Q: What will the assembly government do to support the changes?

A: This report is expected to call for the assembly government to be more strategic in its outlook.

Ms Essex is also expected to say that the funding given to housing associations (social housing grants) should be fixed for a three year period, to give greater stability.

Q: What about the current state of the housing market?

A: It is currently subdued - and that is going to cause more problems for reaching the 6,500 target.

The most recent figures show there has been a big fall in the number of new houses being built in Wales, down by more than a third in three months.

According to council building inspectors and the National House Building Council (NHBC) the number of house-building starts fell by 36% between January and March this year and the last quarter of 2007.

That's a fall of more than a 1,000. Completions were down by a fifth in the same period.



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Related to this story:
'Lost generation' in rural Wales (04 Jun 08 |  Wales )
Minister's rural housing promise (04 Jun 08 |  Wales )
Rural housing control calls made (24 Jan 08 |  North West Wales )
Rural homeless 'twice urban rate' (03 Oct 07 |  Wales )
Planning row over language favour (24 Jan 08 |  Mid Wales )
Developer drops village home plan (26 Sep 07 |  South West Wales )
'Right to buy' could be suspended (04 Dec 07 |  Wales )
Country living 'more expensive' (17 Jul 07 |  England )

RELATED INTERNET LINKS
Welsh Assembly Government
Commission on Rural Housing in Wales
National House Building Council
Joseph Rowntree Foundation
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