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Manchester councillors back new-look housing delivery company

Shutterstock manchester terraces in gorton
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Manchester councillors have backed plans for a housing delivery company that could boost building in the area by 500 affordable homes a year

On Wednesday the local authority’s executive committee voted in favour of work towards an overhaul of the way the city manages housing delivery.

Meeting virtually because of the coronavirus, councillors approved a report by the local authority’s deputy chief executive and city treasurer Carol Culley, which called for £1.5 million to further develop the proposal.

About 4,800 affordable homes are currently expected to be built in Manchester in the decade to 2025. Although the council is working with registered providers to create an extra 1,000 units, a target of 6,400 in the period is ‘unlikely’ to be met, according to the report.

It added that the coronavirus epidemic could slow down development further.

‘Against this backdrop, a new form of local delivery vehicle has the potential to both increase the quantum and rebalance the delivery of affordable homes at or below Local Housing Allowance through a comprehensive utilisation of council land assets,’ said Culley. 

‘This will be funded in part through a cross-subsidy mechanism, derived from the delivery of an associated pipeline of market housing for sale and rent.

‘Current estimates indicate the potential for the local delivery vehicle to deliver approximately 2,000 additional new affordable, low-carbon homes in addition to the homes set to be delivered by registered providers, helping the city to meet and exceed the existing 6,400 minimum target by 2025.’

Council chiefs will now meet with third-party investors to establish the benefits and risks of different funding approaches.

A detailed construction and funding-led risk analysis will also be undertaken to support the final structure of the proposed outfit, and a business plan.

‘Establishment of a local delivery vehicle for the delivery of new homes in Manchester will be an intrinsic part of the city’s economic recovery,’ concluded the report.

The proposed models could include one similar to Croydon Council’s development company Brick By Brick, which builds homes for sale on the private market to subsidise a new wave of affordable homes in the south London borough. 

Manchester councillors also ordered a review of services offered by arms-length management organisation Northwards, which manages 13,000 council homes in the city, with a view to bringing these services in-house.

Further information is expected in September.

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