Supporting Community Housing – How To Do It Blase Lambert 6 th March 2014 Supporting Community Housing – How To Do It Blase Lambert 6 th March 2014

The Confederation of Co-operative Housing The representative body for co-operative and mutual housing in England & Wales since member organisations Aims and objectives: Promote viable forms of co-operative, mutual & community led housing Assist organisations to enhance governance & deliver excellent services Provide networking opportunities

Commission on Co-operative & Mutual Housing

Models of Community Housing Ownership co- operatives Custom (self) build Management co- operatives Co-housing Community land trusts Mutual home ownership

Sanford Housing Co-operative Built in 1970 in New Cross, South London 14 purpose built shared houses Carbon C60 project has reduced their carbon emissions by over 60%, using: Solar panels Biomass boilers Green training and awareness

Community Self Build Diggers Housing Co-op Built in Brighton Self build - built by the members who live there Simple timber frame construction techniques Value of labour reduces the rent Environmentally sustainable homes

Leasehold Management

Redditch Co-operative Homes Accord Housing Association (Finance & Development) Development, Corporate & Financial Services Agreements Redditch Co-operative Homes (Management Services) 7 year lease & Management Agreement Neighbourhood Co-ops (Local Scheme Management) Partnership between Accord HA & Redditch Borough Council Financed & developed through an enabler which retains freehold Long lease to intermediary Shorter leases to 6 local management co- operatives

Key Stages The initial members come together with an idea; or a local authority / enabling developer decides they want to do something – who develops the vision? Building the group Getting the right advice – where do we go? Visiting existing schemes Building the development partnership Scoping the development proposal Agreeing the legal structure Getting the finance in place Drawing up the plans and getting planning permission Building the scheme and moving in (sales & lettings) The long term sustainability

Key Issues Why are you looking to do this? What are you looking to develop? New build or refurbishment Rent, sales or shared ownership / equity share Only housing or not Have you got a site? Is there a community group leading this? Is the local authority supportive? Self-build, community or enabling developer Are there any assets involved or is it all debt / grant driven? What will be the tenure and land ownership model? What are the long term community aspirations?

The Policy Agenda Government support for Community Led Housing through grants, loans & guarantees Affordable Housing Programme Grant Custom Build Revolving Fund Community Right to Build Rent to Buy, Help to Buy & Housing Guarantee Scheme

Becoming a Registered Provider Detailed knowledge of governance required Preliminary stage – must be an English body, providing or intending to provide social housing & intend to meet the HCA criteria Detailed stage – compliance with the Regulatory Framework Compliance with the Financial Viability Standard Meeting the Governance Standard Meeting the Value for Money & Rent Standards Meeting the Consumer Standards Demonstrating a Reasonable Path Intervention & Serious Detriment

Financing a Scheme The Community Land Trust Fund Private Finance – commercial loans (most lenders now in the 5 – 7 year range; small number of specialists for small schemes over long term); bond financing; loanstock; private equity; long term institutional investment Enabling Developers – private developer to take development & sales risk with units released to community group on turnkey basis; local authority borrowing headroom (access to Public Sector Loans Board); housing association levering in funds or guaranteeing scheme; housing co-operatives investing in schemes

Development Modelling Land or buildings purchase Site preparation – clearance, contamination, utilities & access – surveyor? Architect to draw up plans – site area, number & size of homes, tenure split Planning process, s106 & Community Infrastructure Levy Build / refurbishment costs Non residential development – common house, communal areas / facilities, garages & parking, roads & pathways, green & play areas Mixed development – retail, office, community & leisure

Development Modelling Meterage build costs Community & governance development cost Professional fees at both pre development & development phases Development financing requirement – net borrowing requirement Financing interest rate Sources of income – personal equity, existing assets, grants, loanstock, private finance, sales & rents Local housing market data Rent levels & sales prices (uplift rates) by unit / bedspace type Sales costs Legal status & tax considerations

Long Term Modelling Rent inflation rates Cost inflation rates Void and bad debt levels Annual financing cost Leverage & gearing Management & maintenance costs Common parts maintenance & servicing costs 25 year asset management plan with component life cycle, cost & inflation assumptions A costed 25 year financial plan for the scheme & debt balance modelling