Agenda item

Report from the Strategic Director of Regeneration and Environment.

Recommendations:

1.    That Cabinet notes the introduction of First Homes as a mandatory requirement by Central Government.

2.    That Cabinet approves the proposed local eligibility criteria as additional requirements over and above the First Homes mandatory national criteria.  The local eligibility criteria will be published in an Interim Policy Statement on the Council’s website.

3.    That Cabinet approves the introduction of a fee charging system to cover reasonable costs associated with the administration of First Homes in perpetuity.

4.    That Cabinet approves delegation to the Strategic Director for Regeneration and Environment, in consultation with the Cabinet Member for Jobs and the Local Economy, to amend the First Homes local eligibility criteria and fee charging system as required by monitoring and review.

Consideration was given to the report which explained that First Homes became a mandatory Central Government requirement from 28th December, 2021. They were a new affordable home ownership product to be delivered via Section 106 planning obligations on residential development sites. One quarter (25%) of all affordable homes secured by Section 106 planning obligation would be First Homes. The Planning Policy Guidance required First Homes:

-         be discounted by at least 30% against the market value;

-         be sold to a person or persons who met the First Homes eligibility criteria, including locally determined criteria;

-         to be at a price of no higher than £250,000 (or £420,00 in Greater London) after the discount had been applied for the first sale; and

-         on their first sale First Homes would apply a restriction on the title of the property at HM Land Registry to ensure the discount (as a percentage of market value) and certain other restrictions were passed on at each subsequent sale of the property.

Central Government had established mandatory national criteria relating to the delivery of First Homes. In addition to this requirement, local authorities could choose to apply local eligibility criteria, including local residency and employment criteria, income, and price caps. It was proposed that the Interim Policy Statement with Local Eligibility Criteria require that:

-         Applicants shall currently live or have lived in Rotherham within the last 3 years for a continuous period of not less than one year. Proof of address and residency will be required; or,

-         Applicants who leave Rotherham to pursue higher or further education opportunities will be eligible to apply for a First Home for up to 3 years after their exit/graduation from a higher/further education course provided they can prove they were resident in Rotherham Borough, prior to leaving for higher/further education opportunities; or,

-         Applicants shall currently be permanently employed in Rotherham Borough or be able to demonstrate a contract with a local employer. Proof of employer/employment status will be required; or,

-         Applicants are a serving member of the Armed Forces, spouses, or civil partners of current members of the Armed Forces, spouses, or civil partners of a deceased member of the armed forces (if their death was wholly or partly caused by their service) and veterans within 5 years of leaving the armed forces. (Other local connection criteria are disapplied for those meeting the armed forces criteria); and,

-         The property must be the applicant’s only and main home and cannot be rented out for any reason, without the specific consent of the Council and only in exceptional circumstances.

Local eligibility criteria only applied for 3 months from the date the First Home properties were advertised for sale. If First Homes were not sold within this timeframe, the local eligibility criteria was removed and the only restrictions imposed on purchasers would be in compliance with national eligibility criteria. In the future, and only if there was sufficient robust evidence, the Council could introduce additional local eligibility criteria. For example, the reduction of the national income cap and/or increasing the level of discount that could be applied to the sale of First Homes.

It was the developer’s responsibility to sell First Homes to eligible applicants. However, the Council would be directly involved in the sales process for First Homes, both at the initial sale stage and any subsequent resales. As the Council would be involved in the administration of First Homes, a fee was to be charged to the developer for the first sale and to cover costs of administration on subsequent re-sales. Details of the fee charging system were set out in Appendix 1.

Resolved:-

That Cabinet:

1.      Note the introduction of First Homes as a mandatory requirement by Central Government.

2.      Approve the proposed local eligibility criteria as additional requirements over and above the First Homes mandatory national criteria. The local eligibility criteria would be published in an Interim Policy Statement on the Council’s website.

3.      Approve the introduction of a fee charging system to cover reasonable costs associated with the administration of First Homes in perpetuity.

4.      Approve delegation to the Strategic Director for Regeneration and Environment, in consultation with the Cabinet Member for Jobs and the Local Economy, to amend the First Homes local eligibility criteria and fee charging system as required by monitoring and review.