First Homes consultation

This consultation seeks views on First Homes for local people, considering both the design of this policy and options for its implementation.

This consultation aims to cut the cost of some new homes by a third by introducing a discount locked into a property. The document proposes that local people should get first refusal on First Homes and councils should also consider whether they should use the scheme to prioritise allocations to key workers. The MHCLG said it is seeking views on whether changes to planning policy alone would be enough to implement the new policy, or whether it needs to change the law. The government’s Help to Buy scheme is set to wind down in 2023, and the new First Homes policy is set to shift the burden of providing discounted homes for sale to first-time buyers onto developer contributions through the planning system.

The consultation states that the government is considering two broad options to ensure that a larger proportion of discounted homes for sale are delivered through developer contributions. The first would stipulate that a percentage of affordable homes to be delivered through section 106 obligations should be designated as First Homes for discounted sale. However, the consultation said that in some cases, local authorities may not use section 106 contributions to deliver affordable housing, including First Homes, and there is no legal obligation for them to do so. This may have an impact on the number of First Homes delivered overall and in different regions.

A second option would be to impose on every site of more than ten units a requirement that a set percentage of units to be provided as First Homes. The consultation said this would provide greater assurance of delivery, but has a risk of impacting on the viability of specific sites (at least in the short term) which could have negative consequences for other developer contributions and/or lead to developments on these sites being delayed.

The consultation also proposes amending the NPPF on all entry level exception sites, which provide entry-level homes suitable for first-time buyers or the equivalent for those looking to rent. Under the proposals, such sites would have to predominantly deliver First Homes, supported by a small proportion of market homes on sites where they are essential to ensure the development will be deliverable. However, the government is not proposing to extend this requirement to rural exception sites, which are small sites used for affordable housing in perpetuity in places where sites would not normally be used for housing.The consultation says the government is supportive of empowering local decision-makers" and "conscious of reducing discretion to respond to local circumstances.

The document adds that government is minded to exempt First Homes from CIL to increase their delivery. It will also consider amendments to CIL regulations to ensure that CIL rates in England are not set at a level that would prevent current levels of affordable housing delivered through section 106 obligations from being secured in future.

Author: DHCLG

Date: 3/4/2020 End of consultation

This item updates DCP section 7.331

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