Manchester City Council has unveiled a plan to build hundreds of affordable homes through a new financing mechanism.
Under a memorandum of understanding signed by the council, the Greater Manchester Pension Fund and the Homes & Communities Agency, the council’s land assets will be combined with financing from the pension fund to build 240 new homes for sale or rent across five sites.
Development land will be provided by the council – including one site offered by the HCA – while the pension fund will finance the building of the homes with an investment of £25m. The partners will choose a contractor to build the homes and a property manager to manage the rented properties with the city council supporting buyers by taking an equity share in the property.
The project aims to allow buyers to get a home at a 20% discount to the normal market level. If successful, it could be extended in future to fund larger schemes.
Jim Battle (Lab), deputy leader of Manchester City Council, said the scheme was a response to forecast demographic pressures.
“Manchester’s growing population and forecasted economic growth will mean we will continue to need more homes in the near future,” he said. “This new innovative model tackles these issues, pushing forward development opportunities while ensuring a supply of new attractive homes are available to residents at affordable prices.”