Councils are spilling the spending secrets of property developers
Most of us know of the struggles going on in the property industry at the moment. Housing and land have become increasingly unaffordable and we desperately need property developers to help meet housing demand. As the public becomes more concerned about their ability to get their foot on the property ladder and the amenities in their community, the government is taking action.
According to new rules coming into force soon, local residents will see exactly where every pound of property developers’ money goes with new buildings and new homes in the community. The reformed Community Infrastructure Levy (CIL) legislations mean councils must publish an annual report on all CIL agreements entered into with developers as a legal requirement. This is set to come into play from December 2020.
Previously, councils didn’t have to report on the total amount of funding they received, nor how they spent it. Residents of the local community were in the dark. They were not privy to how the council and property developers were making changes in their communities. The new regulations should give the public more insight into where the money goes. Not to mention the benefits it has for the future of their community.
The new regulations also speed up the process of the council introducing levies. So areas will benefit from the infrastructure they need in on a shorter timescale.
Along with the annual reports, the government will reduce restrictions on councils. This allows them to fund more single, larger infrastructure projects from the cash received from multiple developments. This gives councils more freedom to deliver big, complex projects quickly for the community.
The finer details
Section 106 contributions often amount to huge sums of money going into local governments. Where the council considers a development to have potential negative impacts they charge developers section 106 contributions. An example is Blackburn with Darwen Council who received £455,095 in section 106 contributions in 2017/18.
This money is supposedly spent on improving community infrastructure in order to offset any negative impacts from new developments. However, with the introduction of the new laws, the benefits of the spending should become visible and local people may more easily raise their concerns about spending, developments, and their community.
The housing minister, Esther McVey MP, said, “The new rules coming into force today will allow residents to know how developers are contributing to the local community when they build new homes – whether that’s contributing to building a brand-new school, roads, or a doctor’s surgery that the area needs.”
The rules are designed to support councils, helping them get projects moving faster, while promoting greater confidence in communities about the benefits new housing can bring to the area. It’s part of the government’s plan to tackle the housing crisis in the UK.
Property developers and councils have been working together for decades to improve local communities. Agent Hub makes this even easier, connecting all property professionals together on one simple platform, for easy collaboration, communication, and organisation in the property industry. To find out more or request a demo, visit our website.