Property News > ‘Affordable housing’ redefined by West Midlands Combined Authority

‘Affordable housing’ redefined by West Midlands Combined Authority

The definition of ‘affordable housing’ has been altered by the West Midlands Combined
Authority (WMCA), with the term now referring to mortgage values or rent costs of less than 35% of the area’s lower quarter of wage earners.

WMCA is the first regional authority to redefine what constitutes affordable housing, which is typically 80% of market value. Current rules dictate that any development schemes receiving investment from the WMCA’s developed housing and land funds must set aside at least 20% of the output for affordable housing.

Andy Street, mayor of the West Midlands, who chairs the WMCA, said: “In recent years
would-be homeowners have been forced to stand by and watch as house prices outstrip
wages.

“The current ‘affordability’ definition is 80% of market value, which for many people in the
West Midlands still leaves homes frustratingly out of reach.

“By linking the definition of affordability to local people’s earnings rather than property, and using this alongside our minimum 20% requirement, we can help make the prospect of
homeownership a very real one for many more hard-working individuals and families.

“It also sets out a very clear ambition to developers and partners who want to work with us to deliver homes. This is the kind of inclusive growth that is key to building the future of the West Midlands.”

Current projections show that, to meet future housing an economic demand across the West Midlands, the region needs to produce some 215,000 new homes by 2031.

To help ensure that target is met, the authority has encouraged the building of new homes
on former industrial sites with its ‘brownfield first’ policy, having secured funding from central government to help make it happen where possible.

Such sites are often less sought after by developers due to higher clean-up costs along with
other constraints, so substantial funding has been put forward by the WMCA to purchase
brownfield land and make it viable for development.

In 2018/19, the authority saw some 16,938 properties built across the region, up 15% on the
previous year and twice the average increase seen across the UK – a marked upturn on the
7,500 homes completed back in 2011.

Cllr Mike Bird, WMCA portfolio holder for housing and land and leader of Walsall Council,
said: “This is another example of how the WMCA and its partners are changing the housing
market, using our funding to deliver the homes we need in the places where we need them.

“By building on brownfield land, regenerating local areas, supporting living in town centres and linking affordability to local incomes, we are leading the housing revolution.”

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