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House builders urged to sign up to new Section 106 database
The government is encouraging developers to sign up to a new Homes England database aimed at helping them offload unsold Section 106 homes amid a lack of buyers.
House builders can use the agency’s ‘Section 106 Affordable Housing Clearing Service’ to list details of affordable homes that they have planning permission to build alongside private homes, but for which they have been unable to find a buyer.
Registered providers and councils are also able to register with the service to view available stock.
“This means greater visibility of opportunities, all in one place, for buyers and sellers to connect, build new partnerships and work together to get affordable homes sold and occupied,” Homes England said.
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The intervention has come after months of complaints from house builders, which warned that fewer social landlords were buying their Section 106 properties, holding up private housing in the process.
A study from the Home Builders Federation, published this week, found 17,400 affordable homes in England and Wales with planning permission that could not be built because housing associations did not have the financial capacity to bid for them.
The survey of 32 house builders found that work on 139 sites had been delayed due to a lack of Section 106 buyers.
A total of 44% of the 62,000 affordable homes built last year were delivered by developers through Section 106 agreements, which are then sold to councils and housing associations.
However, some registered providers have stopped buying Section 106 homes due to the need to invest in fire safety and other improvements on their existing homes.
Larger housing associations are seeking to build more of their own homes in-house, known as ‘land-led’ development, while other landlords have said that some Section 106 homes on offer do not meet their requirements in terms of size, energy efficiency and build quality.
Homes England said the new service, which launched last week, will continue to develop over the coming months and be refined according to user feedback.
A Ministry of Housing, Communities and Local Government spokesperson said: “We know developers have reportedly faced issues selling Section 106 affordable housing, and this government has taken decisive action to fix this.
“Working with Homes England, we have set up a new clearing service to help unlock delivery of these vital homes to those that need them most and we would encourage developers to engage with this.
“More widely, we have also taken steps to reform the planning system and accelerate progress as we seek to deliver 1.5 million homes as part of this government’s Plan for Change.”
In August, Inside Housing revealed how many Section 106 homes were stuck in the pipeline using data from its Biggest Builders survey.
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