Huge numbers of people cannot afford to buy a flat or house in our area. And private rents are too expensive for most people.
Lewes district is in such need of decent affordable rented and shared ownership homes that it has been agreed that it can set a target that 40% of any new development should be affordable.
But here is the twist, if a developer can show that having this number of homes would make the development financially unviable, this percentage can be reduced. The way viability is calculated is balanced in favour of the developer.
The biggest cost of development is normally land. This is normally acquired by the developer from its previous owner in either a formal competitive tender or by more informal means. Either way the developer will be bidding against others.
Here is where the system breaks down. A powerful developer can outbid others by offering an inflated price from the land if they believe that they can get away with forcing the percentage of affordable homes down. So they can outbid developers who are not so confident or who actually want to provide affordable housing. The developer can use the high price it paid to claim that affordable homes are not viable.
Is this happening on the site of the old Newland’s School in Seaford?
PREPARING THE GROUND
Big sites don’t often become available in Seaford, so when plans were announced to convert the site of the defunct Newlands School, this was a golden opportunity for the large number of people in the area wanting homes they could afford.
The previous owners of the site had retained Jaynic to help them develop and market the site. Jaynic specialises in “promoting employment and residential sites through the planning process”
Jaynic did just that and by mid 2017 they had got an agreement with the council for 183 dwellings on the site. These days large developments have to include payments made to councils called section 106 payments to mitigate the effect that the development would have on the area. Other payments have to be agreed too. There were expenses because Sport England wanted to retain a public playing field. Jaynic sorted all that.
Planning permission was granted in June 2018. So now any potential developer knew what they could build and what payments they would have to make.
Jaynic would no doubt have helped the owners market the site to developers to get the best price.
One of the biggest housebuilders in the country, Bellway Homes, bought the site of the old school on 21 November 2018. Jaynic would have made it very clear to them what they could build and what they would have to pay.
The land registry entry shows that Bellway paid eighteen million and 30 thousand pounds for the site. That is round about £100,000 for each house that they could build.
The Eye is not an expert at land valuation, but this seems quite a high price for land which the Times newspaper had reported was worth £2.3 million in 2006, but without planning permission, which the site now had.
We do not know who else was interested in the site but the Eye has been told that at least one non-profit housing association was interested. Nor do we know Bellway’s intentions at the time on the subject of the affordable housing. But it seems obvious that they offered the most money.
What we do know is that Bellway has now submitted a planning application which seeks to reduce the number of affordable homes from 70 to just 14- or about 8% of the total. Lewes District Council has to decide whether to accept this or not.
The reduction is huge. You can compare this with developers in Newhaven who are offering 30% affordable housing as their first position, and the Lewes North Street development, where a similar figure was agreed. North Street is a particularly difficult site.
They cite the reduction as being due to “Site specific constraints and abnormal costs”.
Bear in mind that:
- The site is largely green field and level, having mainly comprised a number of sports fields. There can hardly be an easier site to develop in the district.
- Bellway knew exactly what they were taking on when they bought the site.
The Eye believes that Bellway believe that they have the financial muscle to overturn the requirement to provide homes that local people can afford. If the council refuses they can appeal to the planning inspectorate and throw money at getting what they want.
But Seaford town council is beginning to campaign against the proposals, and it will be vital that the Lewes District Council members to be elected in May. They will be briefed by the council’s staff who do not have the best of track records.
Do ask your local candidates to oppose the Bellway application.
Bellway is one of the companies who are reported to have sold houses with leaseholds involving the payment of ground rents that rapidly increase as the years go by, making the houses almost unsaleable. So potential buyers should beware.
Bellway makes large profits. Given that a typical price of housing in Seaford is around £350,000, you can imagine what it might make. It also benefits from the government’s “help to buy” scheme which enables buyers to borrow more, but only on new built properties. This is effectively a subsidy for house builders since it enables them to charge more. Help to buy is not available on second-hand property or rented affordable housing.
WHO OWNED THE SITE BEFORE?
It is only of passing interest now, but as long ago as 2006 the Times said that the Chittenden Family who had rund the school had agreed to sell the school to Allum Estates, a small Sussex based developer, but the land registry register for the property suggests that the property was sold by Chittenden Holdings Limited. This is odd because the company is listed as dormant at Companies House. The company was founded 22/05/2015 and its registered address is Stable cottage Eastbourne road Seaford. Jane Stroud, Angela Gilles, Thomas Ogden, and Phillip Moorey are listed as controlling the company. It would be interesting to know if any of them are part of the Chittenden Family and what they think about what Bellway are doing.