Housing developers in the UK could gain hundreds of millions of pounds in windfall profits under a new policy that lets them reduce contributions to building affordable housing or even avoid paying altogether, a council has claimed. Since December, the government has exempted anyone who turns an empty building into private housing from paying for further affordable units, even if they could do so and still make healthy profits.

Among the first super-rich investors to have benefited from the change are the redevelopers of a luxury Mayfair apartment block in central London bought in 2013 by Abu Dhabi’s investment fund. Planners fear Qatar’s ruling family could be next to gain if their agents seek a multimillion-pound cut in the affordable housing bill on a £3bn redevelopment of Chelsea barracks.

emma-reynolds
Shadow housing minister Emma Reynolds. Photograph: Yui Mok/PA

A senior official at Westminster city council, a Conservative-led borough, has described the government’s new vacant building credit as insane and estimated it could lose as much as £1bn in housing payments, deepening the accommodation crisis afflicting the poorest people.

Many other councils also face losing large amounts of affordable housing, officials said. The independent directly elected mayor of Bristol, George Ferguson, said the policy will make it even harder to build enough cheap housing in cities outside London such as his own, where property prices have risen rapidly.

James Murray, executive member for housing at the London borough of Islington, said: “The real impact of this is to increase landowners’ and developers’ profits at the expense of the affordable housing we desperately need.” He said he would resist the policy.

The alarm over the rule change was sounded by John Walker, director of planning at Westminster, who described it as “a government gift [to developers]”. He told the Guardian it has “sent shockwaves across all the boroughs”.

“There will be some sites where we get absolutely nothing,” he said. “On a forthcoming scheme we agreed that £9.1m was viable and we would lose all of that as a result of the vacant building credit. On just three schemes we consented [in a planning meeting] on 13 January we lost £29m. It is insane.”

Who are we?

"Cadman Homes are a family owned & operated firm with a team of highly trained and experienced estate and letting agents".

Registered Office

Cadman Homes
Estate & Letting Agents
6 Albert Street
Rugby
CV21 2RS

News and Property Updates

Contact Us

Rugby
01788 560 905
Lutterworth
01858 881 484

CADMAN HOMES © 2018 - 2019

DESIGNED BY OXYGEN GRAPHICS