Proposal for developer contributions for affordable housing

July 8, 2014

The Department of the Environment (DOE) and the Department for Social Development (DSD) have jointly published consultation papers on proposals to introduce developer contributions for affordable housing. The DOE consultation on proposed Planning Policy Statement 22 on affordable housing sets out the details of how developer contributions could be delivered but the actual amount of affordable housing to be provided or the amount of money to be paid over are to be determined according to targets set through the DSD policy.

The key elements of the proposal to note are as follows:-

1. The need for a developer contribution would apply to all planning applications for 5 or more housing units;

2. Developer contributions may be in the form of provision of social rented housing (either on or off site); intermediate housing (i.e., shared ownership housing); a commuted sum; or a combination of all of the above;

3. The amount for affordable housing will have to be economically viable for the developer and viability will be tested using an economic viability model. DSD suggest that if the developer can make a profit of 15% over the whole development (including both the market housing and the affordable element), the development will be deemed viable;

4. The developer contribution will be delivered either by planning conditions or planning agreement;

5. Consultation on both proposals closes on 26 August 2014.

If you require further information, please speak to Karen Blair or Claire McNally on 028 9024 3141.

Please note: The content of this article is for information purposes only and further advice should be sought from a professional advisor before any action is taken.