HCA announce sustainability standards £4.5 bn 2011-15 Affordable Homes Framework
Posted by Richard Lupo on Tue, Mar 29, 2011
The new four year investment framework for affordable homes looks modestly worded but has shaken the housing world with siezemic changes to the bidding regime for government funds. The framework makes huge changes to finance models and capital funding but sustainability requirements for the Code for Sustainable Homes remain, as do Housing Quality Indicators (HQIs). The localism agenda is visible with increased standards in the London Region. We have summarised requirements below and will be running training sessions to help housing professionals to understand the changes.
Changes to capital finance
Of key importance is the requirement for social housing providers to submit their plans for developing homes for a four year time period. The plans will outline the number of homes that a provider intends to develop, where they will be and how a need has been demonstrated. This is different from the previous grant round which assessed plans on a scheme by scheme basis.
Another key difference that associations will be able (and in fact are encouraged) to charge will be 80% of the market rent. Depending on where the home is built, this may be considerably more than current rents. Where there is an increase this is expected to help fund new homes – and associations are even encouraged to convert rents on existing homes to the new 80% rental when they are re-let. Security of tenure may also be reduced, with tenancies as short as 2 years permitted.
HQIs and the Code for Sustainable Homes requirements for 2011-2015
Homes with HCA funding in 2011-2015 will have to meet existing minimum housing quality indicators (HQI) standards and Code for Sustainable Homes Level 3 as set out in the Design and Quality standards April 2007. Until recently Code 4 homes were an anticipated funding requirement so this is a disappointment for the UK’s sustainability, but more on that later. Nevertheless, the Code 3 requirement is still there, recent building regulation changes are starting to reflect code requirement and many Local Authorities require Code 3 (and sometimes higher) for planning permission.
The London investment region, which is to be devolved to the Mayor of London require additional standards for all new homes from April 2011.
Value for money first
Although there is a statement that “higher standards than the HCA’s requirements will be advantaged in the assessment process” this is subject to offering good value for money. Furthermore the bid template does not have a specific place to enter anticipated HQI score nor Code levels for the planned homes although this will still be required through IMS.
Feed-in Tariffs
One final point concerns feed in tariffs for renewable. The framework document advises applicants to consult DECC and Ofgem websites for further information. The HCA have released additional guidance on potential conflicts between capital grant funding and feed-in tariffs for new build homes. Any renewable intended to benefit from FITs should be clearly separated from the grant amount applied for. This is to ensure that state aid legislation is not contravened.
London presses ahead with Code Level 4 for all new homes
For developers within the London area, the story is very different. The “New Interim Funding Design and Sustainability Standards for London” requires Code 4 as a minimum. Furthermore, items that are non-mandatory in the Code are required for London developments. Examples include cycle storage, ecology, secured by design and Lifetime Homes. A revised format for HQI’s has been developed for the London region and incorporated in to the London standards. These London standards are based on variations to HQIs that include changes to required room size and ceiling heights. HQI data in the current form will still have to be entered onto the IMS system until at least 2012.
New options for sustainable design and infrastructure
One further new aspect is that some of the design guide requirements can be demonstrated using either a Building for Life or BREEAM Communities assessments.
Localism set to drive uptake of Code for Sustainable Homes
So in conclusion, sustainability standards for the new funding regime remain at Code Level 3. Within London Code Level 4 becomes a requirement for all new homes.
The localism agenda of the current Government suggests that this localised approach to the Code for Sustainable Homes is set to continue, with local authority planning requirements becoming the predominant force in additional Code uptake. Central Government will enforce energy efficiency through progressively tightening the Building Regulations towards the 2016 zero carbon target.