Affordable Housing Supplementary Planning Document
Chapter 4: Affordable Housing – Tenure Mix
4.1 Policy H6 establishes the strategic requirements of the Council for developments to deliver at least 25% affordable housing on sites of 25 dwellings or greater. This includes a tenure split that corresponds with spatial considerations that respond to local circumstances and existing housing mix.
4.2 In accordance with the National Planning Policy Framework, Coventry City Council’s policy requires a tenure split between Social/Affordable Rent dwellings and Intermediate Tenure provisions. These are provided on the basis of rental occupation from a Registered Provider, or an Intermediate product which provides an affordable route to home ownership.
4.3 A summary of tenure types and how they are to be split depending on locational factors, is provided below.
| Social/Affordable Rent Provision | Tenure Mix Requirement | |
| Social Rent/Affordable Rent | Social Rent is affordable housing let out at cost calculated against the relative value of the property against median local income and the size of the property. These are usually provided by Registered Providers or local government and are usually between 50% to 60% below market rents on the basis of the formula calculation against their relative market value. Affordable Rent is no more than 80% of market rent and includes the service charge, if applicable. In both cases, it is expected that is the tenures will be offered in perpetuity to eligible households or the subsidy recycled through an alternative product[1] . | 10% - High Concentration Areas 12.5% - Medium Concentration Areas 15% - Low Concentration Areas |
| Affordable Private Rent (Built to Rent/PRS) | Affordable rental homes made available at least 80% discount on market rate. Products made available directly by developer, with ongoing management and operations maintained by the developer. Perpetuity secured by legal agreement. | |
| Intermediate Provision | ||
| General routes to affordable ownership | A variety of products, including Shared Ownership and equity loans. These are offered via Registered Provider regime. | 15% - High Concentration Areas 12.5% - Medium Concentration Areas 10% - Low Concentration Areas |
| Discounted marketed sales | Product provided by developer directly with discount applied at point of sale. Similar arrangement as to Affordable Private Rent | |
| First Homes 30% discount in perpetuity | Discount applied to sales available on the market to eligible first-time purchasers – to a maximum property value of £250,000 and maximum household income of £80,000pa | |
4.4 A minimum provision of affordable routes to home ownership are established in the National Planning Policy Framework of at least 10%. This accords with the minimum requirement in Policy H6 of the Local Plan 2017, ie a minimum requirement of 10% intermediate provision on sites in areas with a high concentration of existing socially rented properties.
4.5 First Homes is an intermediate affordable product introduced in May 2021 as an additional option for buyers to enter the home ownership market on a more affordable basis. These homes are made available on a 30% discount from the local market rate in perpetuity via a land charge on the title deed secured through a Section 106 Agreement. This also ensures that the discount remains in perpetuity. Guidance stipulates that 25% of all affordable home provision on any given site must be First Homes and that this must either contribute to, or make up, the 10% of all homes on a site that are available on an affordable ownership basis.
4.6 Coventry City Council will seek to maintain the affordable rent (social rent) provision as stipulated in Policy H6 and will accept an intermediate mix that establishes 25% of overall affordable provision as First Homes. This should also ensure that other intermediate products remain available so that opportunity of choice is maintained.
4.7 Below is a worked example demonstrating the practical numerical split by unit proportion. It utilises a 100-unit example between the areas of high concentrations of existing social housing and low concentration as per Policy H6:
| Low Social Housing Concentration | High Social Housing Concentration | |||
| Social Rent | Intermediate | Social rent | Intermediate | |
| 15% | 10% | 10% | 15% | |
| Units | 15 | 10 | 10 | 15 |
4.8 The total of 25 affordable units are achieved in both worked examples. With 25% First Homes requirement applied to the gross figure, 6.25 units can be delivered, allowing some flexibility in the delivery of other intermediate products in either worked example. As per the NPPF and PPG, the First Homes provision can contribute towards the overall 10% requirement for homes available as affordable ownership, or make up this requirement, dependent on the gross numbers of dwellings to be delivered.
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