The hipster London borough of Hackney is poised to turn its hand to property development in an attempt to provide local residents with more affordable housing.
In a radical proposal, local Mayor Philip Glanville is lobbying for the council to build thousands of ‘high quality, well-designed, and genuinely affordable new homes’.
A formal consultation was launched in March which asks local residents to provide feedback on the Town Hall’s plans to “set up a local housing company to deliver new homes, with the advantage that the company would operate under different regulations and financial rules and could enable more homes to be built”.
There are strict restrictions on local authorities taking out huge property loans, but Hackney have shrewdly formed their own holding company to manage the process.
The trendy borough’s target is to build 3,000 affordable new homes over the next 10 years in an attempt to fill the gap left by the area’s population boom.
Alongside this population boom came a staggering rise in house prices, with average prices in the borough soaring by 702 per cent, from £75,000 in 1996 to more than £605,000 in 2016, according to a report by Lloyds Bank.
Homes in the area now cost a whopping 14.2 times more than the average London wage, making it all but impossible for bohemian artists and creative businesses to afford property in the hipster hotspot.
Mayor Philip Glanville said, “My vision is a Hackney that works for everyone. That’s why we’re developing a new housing strategy that helps more families have the homes they deserve”. The Labour Mayor went on to say he is looking for, “innovative ways to help residents priced out of the market onto the housing ladder”, which seems prudent in an area where there’s a backlog of 12,000 applicants on the council’s housing register.
DMZ thinks that building affordable homes is not just a bright idea by Hackney, but one that’s long overdue. We suggest the proactive borough goes one step further by creating an entirely separate housing investment arm – examining the council’s outgoings, they are paying external developers a premium to build facilities which they could easily build themselves.
An appropriately designed property investment arm could save the beleaguered authority millions in fees.
The council recently announced its intention to splash out £36 million on a 148-room hostel in Seven Sisters Road so it can stop housing homeless people outside the borough. The development is owned by Top Class Investments and is due to be finished soon, but we wonder if going forward the Council could assemble their own building team and better anticipate future developments.
Some may argue this is a privatization of the public sector, however the authority could use these savings to provide further council houses for the 12,000 waiting list, or home the approximate 2,800 homeless in the borough.
To add your voice to the Hackney Housing Strategy consultation, visit the website here.
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