Nigel Wilson, Chairman of JV North and Chief Executive of Wythenshawe Community Housing Group, explains how the consortium works in partnership with Homes England to build thousands of homes.
News in the Chancellor’s Budget of the successful recipients of Strategic Partnership funding should be warmly welcomed by the sector.
Yet while the 17 partners chosen in waves one and two are set to build thousands of homes, where does that leave the vast majority of developing landlords?
The answer, pleasingly, is that there are still many opportunities via Homes England’s Continuous Market Engagement in the 2016/21 Shared Ownership Affordable Homes Programme [SOAHP].
At JV North – a consortium of housing associations in the North West that came together 11 years ago to make building Government-supported properties more efficient by pooling resources – we recently received further grant of £51.6 million to build 1,550 more homes.
The new funding is in addition to the £87.3 million we received in 2016 and will see us build a total of 4,310 homes by 2021.
There is clear need to build more high quality homes quicker than ever before and our members are answering the call.
We have never ‘over promised and under delivered’ and through each Affordable Homes Programme, we’ve always made ambitious initial bids increase them via Continuous Market Engagement where we can.
Given we have over 4,000 homes to build, our members are forging ahead and for the first six months of this financial year, have started onsite building the equivalent of two-and-a-half homes every working day.
When assessing our programme following Mr Hammond’s announcement and analysing the amount of grant and the number of homes, it is very similar to some Strategic Partnership allocations and in many ways we are delivering exactly the same objectives.
When coupled with our excellent relationship with Homes England nurtured over many years, we view ourselves as a Strategic Partner but without the name above the door and our funding coming from a different pot.
The advantage of Strategic Partnerships as we see them is certainty of allocation of funding compared to bidding through Continuous Market Engagement.
Strategic Partnerships are over a longer period and it’s a balance of weighing that up against the potential risks of not being able to deliver large programmes so far into the future, especially while there is still uncertainty around the implications of Brexit and next year’s Comprehensive Spending Review.
But social housing never stands still and we have to build.
We are comforted by Homes England telling us that Continuous Market Engagement will continue so there is potentially more funding available if we have any more capacity to build.
We are also buoyed by the additional flexibilities the Strategic Partnerships would appear to offer especially as it is stated in Homes England’s Strategic Five Year Plan that its new approach will be passed down through existing development partner contracts and we hope to benefit from this.
Homes England’s new approach will allow us to operate with more liquidity to meet housing needs rather than be tied to a policy or tenure that in the case of the 2016/21 SOAHP, could be five-years-old by the time the final properties are delivered.
Regardless of which fund Government grant comes from, the same challenges remain, most notably being able to identify firm development opportunities and guarding against unhealthy competition between providers where the biggest winner becomes the landowner.
There is also a challenge around capacity and not just in the construction sector but within social housing; there’s a scarcity of skilled, experienced development staff who need to deliver thousands of homes across the country.
Ultimately, it’s important we recognise the benefit of multiple approaches and the more opportunities to build the better – whether that is as a Strategic Partner or a partner operating strategically to tackle the housing crisis.