Islington Council wages war on 'buy-to-leave' investors
PUBLISHED: 12:17 21 July 2015 | UPDATED: 12:17 21 July 2015
Town hall also plans to prevent developers from ducking their affordable housing responsibilities
New rules that will expose “buy to leave” property investors and money-grabbing developers have been put forward by Islington Council.
The Town Hall has announced a new supplementary planning document (SPD) which will allow them to take property owners to court if their home is empty for more than three months.
The Council will use the electoral role as well as other council held data as well as relying on council officers, councillors and residents to report empty homes.
It comes in response to concerns in recent years that a significant number of new homes in Islington, as in other parts of London, are sold off-plan to investors, some of whom then leave the properties empty as investments.
The town hall have also announced the start of a ground breaking consultation for an SPD which would prevent developers from gaming the planning system to avoid building affordable homes
Cllr James Murray, Islington Council’s executive member for housing and development, said: “Islington, like London, is facing a housing crisis and it’s vital that all new homes help meet the huge demand for places to live.
“It’s wrong if new homes are sold off-plan to investors who don’t even rent the properties out. It’s truly galling for Londoners who are desperately trying to find somewhere to live.
“Our new measures make it clear that ‘buy-to-leave’ is unacceptable. They make clear that new homes have to, at the very least, be lived in – I think that’s a pretty reasonable thing to ask.”
Through another SPD, the council are also lifting the lid on the shady world of “viability assessments” in relation to new developments, which saw plans like the Mount Pleasant development in Clerkenwell approved by Mayor Boris Johnson with just 20 per cent “affordable housing”, despite the council usually requiring of 50 per cent affordable rents.
Cllr Murray said: “There is growing evidence some developers use ‘viability assessments’ to their advantage, such as inflating land costs to say they can’t afford to build affordable housing.
“We’re setting out new rules to make sure developers can’t game the system. We want to make the system transparent, clear, and fair, to help make sure the affordable housing we badly need is built.”
A big part of this SPD will be challenging developers rights to keep this information confidential and ensuring greater transparency.
To keep details private developers will have to prove that this would be in the public interest and not just for their own commercial benefit.
It also requires developers to justify the levels of profit that they seek while preventing land owners from inflating values and developers overpaying for land at the expense of affordable housing.
The consultation on this SPD ends on September 4 and can be found at www.islington.gov.uk/developmentviability