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We’re building 11,000 council houses in the heart of the capital

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The housing crisis in London is very real. As I write, a Shelter study has found that there are just 43 affordable homes available to buy in the whole of our capital city.

  • Project: Southwark LBC new build council housing
  • Objectives: 11,000 new council homes
  • Timescale: 2013-2043, with first 1,500 completed by 2018
  • Cost to authority: £1,900 per m2
  • Number of staff working on project: 12
  • Officer contact details: Gerri Scott

For many Londoners, the private rented sector is increasingly out of reach. My council’s commitment to building quality homes at a genuine social rent isn’t just an option for us; as a council located in the heart of a world class city, it is the only responsible thing to do.     

Gerri Scott, strategic director of housing and community services, Southwark LBC

Gerri Scott, strategic director of housing and community services

In July 2013, Southwark LBC made a historic commitment to build 11,000 new council homes by 2043. Next month sees the completion of Willow Walk: 21 brand new council homes with a 54-place short-stay hostel and the first newly built council housing in Southwark for decades. Willow Walk is trailblazer for the first four years of a delivery pipeline which will achieve an interim target of 1,500 new council homes by 2018. 

History of regeneration

Southwark is a borough that has embraced development. Over the past two decades, housing associations and private developers, working in partnership with the council, have transformed the landscape. The council has also shown leadership in transforming its own housing with huge estate regeneration schemes up and running at the Heygate and Aylesbury estates in the Elephant and Castle area.

Willow Walk Boards two

 

But for the first time in a generation, there’s a new commitment to meeting a growing demand. The council plans to build more homes of every kind and specifically 11,000 council homes with truly affordable rents matching the social rents paid by existing council tenants. 

Our direct delivery programme is ambitious but firmly rooted in the community. Improving housing in Southwark is central to the council’s wider plans to create a fairer future for all. Access to appropriate, good quality, genuinely affordable homes is important not just for residents but also for the wider economy. Housing is essential to shaping a borough that all residents can be proud of and which is truly sustainable into the future. 

Engaging residents

Consultation and engagement on the future of council housing has been an integral part of the approach that the council has taken and local residents continue to be engaged in a number of ways.

The engagement process has included wide-ranging community conversations online and face to face, consultation through more formal mechanisms, including through homeowners’ and tenants’ councils, and the establishment of a sounding board made up of tenants and homeowners. This group, the futures steering board, is the resident voice which agrees the design principles, the funding mechanisms and the tenure mix, for as well as building 11,000 social rented homes, we are cross-subsidising the programme with additional low cost home ownership and market rent homes. 

We’ve placed our residents at the heart of the programme asking them who the new council housing should be for. They decided that all new council housing should be let to Southwark residents, either through a local lettings scheme, which frees up overcrowded accommodation and enables people to downsize on neighbouring estates, or let to local people on the housing register in housing need. Residents are also helping to identify future development sites through an interactive map on the council’s website. So far, 45 potential sites have been identified by residents.    

model one

 

Experience and partnership

Southwark has an excellent track record in regeneration. We’ve taken our experience of large-scale development and working in partnership with the private sector and applied these skills to the new build delivery team. This team is used to delivering large-scale projects and is just completing a five-year, £500m major works programme. Their knowledge of the housing stock and their strong relationships with architects, builders and housing association partners has helped to shape the development strategy for a realistic and achievable delivery programme. We are keen not to repeat the mistakes of the past and we buy in expertise from the market as and when it is needed rather than create behemoth teams within the council. 

Funding streams

Southwark is the biggest council landlord in London and one of the biggest in the country. With 54,000 council properties, we have a number of different funding sources to support a programme of this size, not least the land currently owned by the council. There are also s106 contributions from developers, right-to-buy receipts and disposal of high-cost empty properties on the open market where the sale of one property can fund the build of several new properties. 

There are, of course, constraints to how we use our funding sources. For example, the council is prevented from combining right-to-buy receipts and receipts from the disposal of existing properties to fund one scheme. It’s disappointing that on the one hand, government is challenging local authorities to use its freedoms and flexibilities to develop council housing, but on the other hand frustrates our overall capacity to do so. 

Nevertheless, Southwark has been fortunate in realising significant income from large-scale regeneration on council land and we’re using this to finance the programme alongside the borrowing capacity in our housing revenue account. We’ve also just set up a housing company, which can be used to hold properties which will require general fund borrowing supported by the net rental income. Although we don’t see this as the primary funding vehicle for development, we are excited about the potential of using this route to develop intermediate housing products, which, as well as bankrolling the new build housing programme, could help to support strains on the council’s general fund. We have a smart appraisal model which gives assurance around the funding mechanisms and value for money of each potential scheme, as well as locking in at the earliest stage the aspirational community benefits we want to realise. 

model two

 

Outcomes

For our residents, this is about creating genuinely affordable rents in the centre of London. The direct delivery programme provides families in need of housing with options. For our existing residents, it creates movement in the stock, such as enabling residents to downsize to escape the spare room subsidy while maintaining longstanding roots and connections to the local community.

As the developer, we are also able to prescribe the type of property we want to build, based on our housing management experience and the desires and needs of potential residents. Our new homes at Willow Walk are well-designed and spacious. As lifetime homes, they will flex to accommodate residents as they move through the different stages of life. For our staff, there’s an enormous sense of pride in signing up new tenants to such high-quality homes.   

In the longer term, we want to be able to lock in tenancy management organisations at the earliest stage of development. Southwark is at the vanguard of tenancy management. We have a number of thriving TMOs which achieve high levels of resident satisfaction and a strong sense of pride in their independence. Indeed, one of our most successful TMOs is developing its own new council housing. Potentially, we see new build schemes as an opportunity to embed tenancy management principles at the point of inception and we are working with the future steering board to model what that might look like. 

Gerri Scott, strategic director of housing and community services, Southwark LBC

 

 

 

 

 

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