Vale of Glamorgan Council Viability Study
Final Report
June 2010
Dr Andrew Golland BSc, PhD, MRICS
drajg@btopenworld.com
Vale of Glamorgan – Final Viability Report 2010 Page 1
INTRODUCTION
Review of project aims
1.1 The Vale of Glamorgan Council appointed Three Dragons to prepare an
Affordable Housing Viability Assessment (AHVA) compliant with the
requirements of the Welsh Assembly Government’s TAN2 which emphasises
the importance of viability testing policy targets.
1.2 The overall aim and purpose of the study is to:
• Advise on the most ambitious yet achievable and viable target(s) and
threshold(s) for affordable housing which fully reflect the availability of
a range of finance towards affordable housing and reflects priority
infrastructure needs;
• To assess the impact of the profile of sites within the Vale of
Glamorgan on housing viability;
• Advise on a robust policy position with respect to the setting of
thresholds which do not impact on the delivery of housing in the Vale.
1.3 The study will support the Council’s Local Development Plan providing a key
piece of evidence on the viability of housing development by setting
deliverable affordable housing targets and by assessing an appropriate
threshold which should trigger affordable housing contributions. The study
should be robust to the period of the LDP although recognising that the
Council may wish to re-visit the findings should there be significant market
change.
National Policy Context
1.4 This study focuses on the percentage of affordable housing sought on mixed
tenure sites and the size of site from above which affordable housing is
sought (the site size threshold). LPAs require AHVSs as part of their
evidence base for use in preparing LDPs. The importance of gathering
evidence about development economics was identified in TAN2 which states
that, in relation to setting the affordable housing target:
“The target should take account of the anticipated level of finance available for
affordable housing, including public subsidy, and the level of developer
contribution that can realistically be sought”. (TAN 2, Para 9.1)
1.5 Guidance from the Welsh Assembly Government on the preparation of
Affordable Housing Delivery Statements (2007 – 2011) 1 by local authorities
re-iterates the importance of viability evidence in identifying targets for
affordable housing delivery.
“Targets for the amount of affordable housing to be provided should reflect an
assessment of the likely economic viability of land for housing within the area,
taking account of risks to delivery and on the likely levels of finance available
for affordable housing, including both public subsidy such as Social Housing
Grant and the level of developer contribution that could reasonably be
secured. A viability calculation is equally relevant in a buoyant or a depressed
market. The needs of both current and future occupiers should be provided
1
Published by the Welsh Assembly Government in February 2009
Vale of Glamorgan – Final Viability Report 2010 Page 2
for, building on evidence in the Local Housing Market Assessment.” (Para
1.24)
1.6 The courts have further emphasised the importance of robust viability
evidence to underpin affordable housing policies in development plans. The
Court of Appeal, in July 2008, decided on a case brought against Blyth Valley
Council. The court stated that:
“……an informed assessment of the viability of any such percentage figure is
a central feature of the PPS 3 policy on affordable housing. It is not
peripheral, optional or cosmetic. It is patently a crucial requirement of the
policy.”
1.7 Evidence on viability is also required to demonstrate the robustness of the site
size threshold to be set out in the LDP. The threshold identifies the size of site
above which the LPA can seek affordable housing. TAN2 does not provide
any national guidance on appropriate thresholds and leaves this to LPAs to
identify. However, TAN does comment that,
“When setting site-capacity thresholds and site specific targets local planning
authorities should balance the need for affordable housing against site
viability”. (TAN2 para 10.4)
Local Plan Policy
1.8 The Vale of Glamorgan Unitary Development Plan (UDP) (1996 to 2011) was
formally adopted on 18th April 2005. Housing Policy 12 of the Plan specifically
refers to Affordable Housing and states that:
‘The Council will where there is a demonstrable need, seek to negotiate with
developers for the inclusion of a reasonable element of affordable housing in
substantial development schemes’.
1.9 The UDP explains that a ‘substantial development’ is defined as a housing
development of more than 50 units. The UDP states that the bulk of
affordable housing provision will be made in the urban areas of the Vale and
in Barry and Penarth.
1.10 The UDP points (Para 4.2.8) out the ability of local authorities to set affordable
housing policies in line with the policies set out in TAN 2.
1.11 In April 2009 the Council published Supplementary Planning Guidance (SPG)
entitled ‘Planning Obligations’. This stated that:
‘In light of the evidence contained in the recent Housing Market Assessment
showing a high level of need for affordable housing throughout the Vale, the
Council is likely in future to seek at least 30% affordable housing provision on
major development sites in order to meet this need. In addition, the Council
may seek affordable housing provision on smaller residential developments
where there is evidence of a high level of need in the vicinity.
1.12 By smaller residential development was meant development of less than 50
dwellings set out in the UDP.
Vale of Glamorgan – Final Viability Report 2010 Page 3
1.13 Soon after, in October 2009 the Council published an Affordable Housing
Delivery Statement (AHDS). This is understood to be the key policy
document in looking at the Council’s policy going forward. The AHDS was
subject to consultation. The Council has responded in the document to points
raised by consultees.
1.14 The AHDS states that the findings of the recent Local Housing Market
Assessment (LHMA) suggested that the Council could justifiably set a
requirement of 45% affordable housing on development sites. This would be
subject to viability testing.
1.15 The AHDS states that the Council will require affordable housing to be
provided on sites capable of accommodating 10 or more units (or 0.3 Ha). In
accordance with this policy, all qualifying sites will be expected to provide
30% affordable housing.
1.16 The AHDS states that where a developer considers that a site is affected by
significant economic or other constraints that are ‘sufficient to jeopardise
meeting the Council’s affordable housing requirements’ then the developer
will need to provide financial and other information to enable the Council to
assess the nature, extent and impact of the constraints.
1.17 Some aspects of the ADHS were queried, in particular by the Home Builders
Federation. The Council subsequently commissioned this piece of evidence
which will aim to address these concerns in large measure.
Research undertaken
1.18 There were four main strands to the research undertaken to complete this
study:
• Discussions with a project group of officers from the Council’s Planning
and Housing sections which informed the structure of the research
approach;
• Analysis of information held by the authority, including that which
described the profile of land supply;
• Use of the Welsh Development Appraisal Toolkit (DAT) to analyse
scheme viability (and described in detail in subsequent chapters of this
report);
• A workshop held with developers, land owners, their agents and
representatives from a selection of Registered Social Landlords active in
the Vale. A full note of the workshop is shown in Appendix 1.
Structure of the report
1.19 The remainder of the report uses the following structure:
• Chapter 2 explains the methodology we have followed in undertaking the
analysis of development economics. We explain that this is based on
residual value principles;
Vale of Glamorgan – Final Viability Report 2010 Page 4
• Chapter 3 provides analysis of residual values generated across a range
of different development scenarios (including alternative percentages and
mixes of affordable housing) for a notional 1 hectare site.
• Chapter 4 considers options for site size thresholds. It reviews national
policy and the potential future land supply and the relative importance of
small sites. The chapter considers practical issues about on-site
provision of affordable housing on small sites and the circumstances in
which collection of a financial contribution might be appropriate (and the
principles by which such contributions should be assessed);
• Chapter 5 identifies a number of case study sites (generally small sites
which are currently in use), that represent examples of site types found in
the authority. For each site type, there is an analysis of the residual
value of the sites and compares this with their existing use value.
• Chapter 6 summarises the evidence collected through the research and
provides a set of policy options.
Vale of Glamorgan – Final Viability Report 2010 Page 5
2 METHODOLOGY
Introduction
2.1 In this chapter we explain the methodology we have followed in, first,
identifying sub markets (which are based on areas with strong similarities in
terms of house prices) and, second, undertaking the analysis of development
economics. The chapter explains the concept of a residual value approach
and the relationship between residual values and existing/alternative use
values.
Viability – starting points
2.2 We use a residual development appraisal model to assess development
viability. This mimics the approach of virtually all developers when purchasing
land. This model assumes that the value of the site will be the difference
between what the scheme generates and what it costs to develop. The model
can take into account the impact on scheme residual value of affordable
housing and other section 106 contributions.
2.3 Figure 2.1 below shows diagrammatically the underlying principles of the
approach. Scheme costs are deducted from scheme revenue to arrive at a
gross residual value. Scheme costs assume a profit margin to the developer
and the ‘build costs’ as shown in the diagram include such items as
professional fees, finance costs, marketing fees and any overheads borne by
the development company.
2.4 The gross residual value is the starting point for negotiations about the level
and scope of section 106 contribution. The contribution will normally be
greatest in the form of affordable housing but other section 106 items will also
reduce the gross residual value of the site. Once the section 106
contributions have been deducted, this leaves a net residual value.
Figure 2.1 Theory of the Section 106 Process
Vale of Glamorgan – Final Viability Report 2010 Page 6
2.5 Calculating what is likely to be the value of a site given a specific planning
permission, is only one factor in deciding what is viable.
2.6 A site is extremely unlikely to proceed where the costs of a proposed scheme
exceed the revenue. But simply having a positive residual value will not
guarantee that development happens. The existing use value of the site, or
indeed a realistic alternative use value for a site (e.g. commercial) will also
play a role in the mind of the land owner in bringing the site forward and thus
is a factor in deciding whether a site is likely to be brought forward for
housing.
2.7 Figure 2.2 shows how this operates in theory. Residual value falls as the
proportion of affordable housing increases. At some point (here ‘b’),
alternative use value (or existing use value whichever is higher) will be equal
to scheme value. If there is a reasonable return to the land owner at point ‘b’
i.e ‘b’ reflects best possible current use value (alternative or existing) and
there is a sufficient return, then the scheme will come forward. At point ‘c’,
affordable housing will make the site unviable. At ‘a’ the scheme should be
viable with affordable housing. The diagram does not assume grant. Grant
should be used to ‘lever out’ sites from their existing or best alternative uses.
Figure 2.2 Affordable housing and alternative use value
2.8 The analysis we have undertaken uses a Three Dragons Viability model. The
model is explained in more detail in Appendix 2, which includes a description
of the key assumptions used.
Good practice approach
2.9 We have adopted the approach promoted in SEWSPG’s (South East Wales
Strategic Planning Group) Good Practice Guide to carrying out affordable
housing studies. The general approach has been endorsed by the
development industry in Wales.
Vale of Glamorgan – Final Viability Report 2010 Page 7
2.10 A summary of the approach is shown in Figure 2.3 below.
Figure 2.3 Good practice approach to carrying out affordable housing
viability studies (SEWSPG Guide)
Vale of Glamorgan – Final Viability Report 2010 Page 8
3 HIGH LEVEL TESTING
Introduction
3.1 This chapter of the report considers viability for mixed tenure residential
development for a number of different proportions and types of
affordable housing. The analysis is based on a notional 1 hectare site
and has been undertaken for a series of market value areas that were
identified as part of the analysis underpinning the development of Wales
DAT (Development Appraisal Toolkit). The chapter explains this and
explores the relationship between the residual value for the scenarios
tested and existing/alternative use values.
3.2 The analysis relates to scheme residuals which we would expect to be
achieved across a range of sites including brown and green field
situations. Housing development on green field sites for example will not
necessarily be less expensive in terms of costs than would be the case
for brown field sites. For instance, where there are clearance costs
required on brown field sites these are often much better located in terms
of local infrastructure provision than is the case with green field sites.
The site specific costs, and indeed, values, will therefore need to be
assessed through the Development Appraisal Toolkit as and when these
become known as sites are brought forward.
Market value areas
3.3 Variation in house prices will have a significant impact on development
economics and the impact of affordable housing on scheme viability.
3.4 We have undertaken a full analysis of development across the housing
market, using HM Land Registry data to identify market value or sub
market areas in the District. The analysis applies as at February 2010.
3.5 The purpose of this analysis is to help establish a broad starting point for
target setting in the light of the general relationships between
development revenues and development costs. Table 3.1 and Map 1
below sets out the market value areas or sub markets for the Vale.
Table 3.1 Sub markets in the Vale of Glamorgan area
Sub Markets Postcode
Rural (including Cowbridge) CF7 17, CF35 5, CF35 0, CF32 0, CF72 8,
CF72 9
East Vale CF5 6, CF5 5, CF11 8
Penarth (including Llandough, CF64 1, CF64 2, CF64 3, CF64 4, CF 65 5
Dinas Powys and Sully)
Rural South & Coast (including CF61 1, CF61 2, CF62 3, CF62 4
Llantwit Major)
Barry West CF62 5, CF62 6, CF62 7
Barry East CF63 1, CF63 2, CF63 3, CF64 4, CF62 8,
CF62 9
Source: Vale of Glamorgan Council and Three Dragons
Vale of Glamorgan – Final Viability Report 2010 Page 9
Map 1: Vale of Glamorgan Housing Submarkets by Postcode
Vale of Glamorgan – Final Viability Report 2010 Page 10
Testing assumptions (notional one hectare site)
3.6 For the viability testing, we defined a number of development mix
scenarios, using a range of assumptions agreed with the council and as
applying in the DAT.
3.7 The development mixes were as follows:
• 30 dph: including 10% 3 bed terraces; 10% 3 bed semis; 10% 4 bed
semis; 20% 3 bed detached; 30% 4 bed detached; 20% 5 bed detached.
• 40 dph: including 5% 1 bed flats; 10% 2 bed flats; 20% 2 bed terraces;
20% 3 bed terraces; 5% 4 bed terraces; 10% 3 bed semis; 10% 4 bed
semis; 10% 3 bed detached; 10% 4 bed detached.
• 50 dph: including 15% 1 bed flats; 20% 2 bed flats; 25% 2 bed terraces;
30% 3 bed terraces; 5% 3 bed semis; 5% 4 bed semis.
• 75 dph: including 5% studio flats; 25% 1 bed flats; 40% 2 bed flats; 5% 1
bed terraces; 15% 2 bed terraces; 10% 3 bed terraces.
3.8 We calculated residual site values for each of these (base mix) scenarios
in line with a further set of tenure assumptions. These were 10%; 15%;
20%; 25%; 30%, 35% and 40%. These were tested at 65% Social Rent
and 35% HomeBuy in each case, as this was the level of need identified
in the LHMA. For HomeBuy, the share purchase was assumed to be
60%. For the purposes of the viability calculation, this assumes the
payment from an RSL will be 60% of the open market value of the unit.
This is believed to be a rate at which units will be affordable to
prospective HomeBuy occupiers, although the rate may vary in practice
according to local market conditions. All the assumptions were agreed
with the authority.
3.9 We are aware that the current difficulties in obtaining mortgages for
households on lower incomes is affecting the intermediate affordable
housing sale market. In the short term, this may mean that the mix of
affordable tenures which is provided will be different from that which we
have modelled. However, the figures we have used are intended to
provide information for the local authority to use in planning for the longer
term and hence the balance of tenures we have modelled. This is
considered to be a safe assumption based on market and economic
trends over the long term and in view of the fact that, the authority will be
able to consider the economics of individual schemes with a different
affordable housing mix, using the DAT. or other development appraisal
model if the trend continues in the short and medium term.
Other section 106 Infrastructure contributions
3.10 For the modelling we have undertaken (and unless shown otherwise) we
have assumed that other planning obligations have a total cost of £5,000
per unit. This was a figure agreed with the Council as being a
reasonable requirement on a per unit basis based on the current level of
contributions. We test also at a contribution of £10,000 per unit as a
higher potential level. In the event that the Vale of Glamorgan Council
introduce a Community Infrastructure Levy (CIL) in the future, these
Vale of Glamorgan – Final Viability Report 2010 Page 11
assumptions are likely to be safe in view of the DCLG assumptions that
charging authorities are likely to charge between £5000 and £10,000 per
unit for CIL.
3.11 We also consider separately the impact on viability of the Code for
Sustainable Homes at code level 4.
Results: residual values for a notional one hectare site
3.12 This section looks at a range of development mixes and densities. It
shows the impacts of increasing the percentage of affordable housing on
residual site values. Unless otherwise indicated, all the results are
without grant. The full set of these results are shown in Appendix 3.
Low density housing (30 dph)
3.13 Figure 3.1 shows low density housing (30dph) and the residual values for
each of the market value areas outlined in Section 3.
Figure 3.1 Low density housing (30 dph) – Residual value in £s million
• Figure 3.1 shows residual values on a per hectare basis for the six sub
markets. It shows that residual values are generally buoyant and that at
30 dph all residuals are positive. This means that, subject to
considerations of existing use value, the Council will have a sound
starting point for requiring affordable housing contributions including other
Section 106 obligations.
• The chart (Figure 3.1) shows a fairly distinct split between on the one
hand the Rural, East Vale and Penarth and Dinas Powys sub markets,
and, on the other, the Rural South Coast and Barry (West and East). The
differences are marked. At 35% affordable housing (Figure 3.1) in
Penarth (third highest value sub market) residual value is higher than at
Vale of Glamorgan – Final Viability Report 2010 Page 12
100% market housing in the next highest value sub market of the Rural
South and Coast.
• The range in values has potentially important implications for policy
making. The graph shows the very significant difference in residual
values between areas and this difference creates a strong case for the
Council to promote a split affordable housing target.
Medium density housing (40 dph)
3.14 Figure 3.2 shows medium density housing (40 dph) and the residual
values for each of the market value areas.
Figure 3.2 Medium density housing (40 dph) – Residual value in £s
million
• The scenario at 40 dph generates a similar pattern of residual values as
at 30 dph with the higher three sub markets generating significantly
higher residual values than the three lower value sub markets.
• Residual values at 40% affordable housing in Penarth are £1.7 million per
hectare, a significant value. At the same (40%) affordable housing target
however in Barry West however, the residual value is £0.4 million per
hectare.
• Figure 3.2 (40 dph) shows consistently lower residual values on a per
hectare basis than is the case at 30 dph. This is we believe largely due
to the assumptions made on development mix where the 30 dph scenario
includes a high proportion of larger units which tend to ‘cover’
development costs better than smaller ones. We do not believe that a
higher density in a location such as the Vale will systematically produce a
lower residual than say at 30 dph.
• At the bottom end of the market; i.e. Barry East, residual value is
negative at 35% and 40% affordable housing. This indicates a lack of
Vale of Glamorgan – Final Viability Report 2010 Page 13
viability and a likelihood that even in the hot spots of this sub market an
affordable housing contribution above 30% will be marginal.
Higher density (50 dph) scheme
3.15 Figure 3.4 shows a higher density scheme – at 50 dph, and the residual
values for each of the market value areas.
Figure 3.4 Higher density housing (50 dph) – Residual value in £s
million
• Increasing density to 50 dph (from 40 dph) will reduce residual values in
all instances (at all percentages of affordable housing and at all densities)
except one. As previously we do not believe that an increase in density
will deliver a lower residual in every case although the Council will need
to consider the ‘trade off’ between density and location in maximising
affordable housing contributions as sites come forward.
• At this density, it can be seen that residual values are still relatively high
in the higher house price areas. In the Rural sub market, residuals at
40% affordable housing are approaching £2 million per hectare (£1.82
million per Ha). By contrast, significant negative residual values are now
seen in Barry East. At 20% affordable housing residuals are negative
and at 40% target, the residual is almost £1.5 million per hectare
negative.
• The impact of affordable housing, where the gap between revenue and
cost is marginal, as it is with smaller units (more included at 50 dph) is
very significant. A mix of larger, and family type housing, is likely in many
cases to generate the best returns for land owners
Vale of Glamorgan – Final Viability Report 2010 Page 14
High density (75 dph) scheme
3.16 Figure 3.5 shows a higher density (75 dph) scheme. The main impact
here is to decrease viability in most scenarios tested (versus the 50 dph
scenario). However, in the higher value sub markets at lower and zero
affordable housing, the impact is to increase residuals.
3.17 There is however (Figure 3.4) weak viability in Barry in particular. The
analysis suggests that for this higher density development in Barry East,
no affordable housing will be viable, and even that at 100% market
housing, scheme residual will be negative or site value nil.
Figure 3.5 Higher density housing (75 dph) – Residual value in £s
million
Impacts of potential grant funding
3.18 The availability of public subsidy, in Wales in the form of SHG (Social
Housing Grant) money, can have a significant impact on scheme
viability. Grant given to the affordable housing providers enables them to
pay more for affordable housing units, thus increasing overall scheme
revenue and therefore the residual value of a mixed tenure scheme.
3.19 We look here at the impact of the SHG funding regime on viability. We
select here ACG (Acceptable Cost Guidance) Band Level 5, as a lower-
point band range for the authority. We run the scenarios assuming SHG
at 100% of ACG. Figure 3.6 shows the results for a 30 dph scheme.
Vale of Glamorgan – Final Viability Report 2010 Page 15
Figure 3.6 Medium density housing (30 dph) – Residual value in £s
million; ACG at 100%
3.20 Figure 3.6 shows the specific impacts of subsidy in a location such as
the Vale. It shows two main impacts.
3.21 In the three higher value areas, residual value falls as affordable housing
is increased within a scheme. In other words, the SHG subsidy scheme,
whilst it significantly bolsters residual value, does not increase residual
value as the affordable housing percentage increases.
3.22 In the three lower value sub markets, the pattern moves in the opposite
direction. In other words, residual values actually rise as affordable
housing is increased within a scheme. The lower the value of house
prices in an area, the greater the impact of the SHG input to residual
value. Residual value in Rural South and Coast at 40% affordable
housing is 1% higher than at 100% market housing (nil affordable
housing); in Barry East, residual value at 40% affordable housing is 40%
higher than that at nil affordable housing.
3.23 The reason for the diverse trends is that in the higher value areas the
opportunity cost of providing affordable housing supported by SHG is
greater than in the lower value areas. Where house prices are low, grant
supported affordable housing increases residual, where in the higher
house price areas, residual value falls even when SHG support is
available.
3.24 Figure 3.7 shows a similar pattern but at a higher density. The lower
three value sub markets show a trend where residual values fall as the
affordable housing target increases, whilst in the lowest three value sub
markets residual values rise as affordable housing supported by grant is
increased.
Vale of Glamorgan – Final Viability Report 2010 Page 16
Figure 3.7 Medium density housing (50 dph) – Residual value in £s
million; ACG at 100%
3.25 The trends are significant for policy making. Where grant can be
obtained for schemes, the impact in terms of viability is significantly more
‘elastic’ in lower than higher value areas. This does not mean that higher
value areas should not require grant, (as for example existing use values
can be commensurately higher) but that the relative ability of higher
value areas to cross subsidise affordable housing is greater.
Affordable element split 80% Social Rent and 20% Homebuy
3.26 The analysis carried out thus far has assumed an apportionment of 65%
Social Rent and 35% Homebuy at each affordable housing target tested.
We understand that the Council may consider, in consequence of its
LHMA, a split of 80% Social Rent and 20% Homebuy. Figure 3.8 shows
the results of this analysis.
Vale of Glamorgan – Final Viability Report 2010 Page 17
Figure 3.8 Medium density housing (50 dph) – Residual value in £s
million; Affordable element 80% Social Rent (SR) 20% Homebuy (HB)
3.27 The impact of the change in tenure will be felt most in the weakest sub
market areas. Developing a scheme with an 80% SR: 20% HB split will
reduce residual values by between 2% and 18% (rising with the overall)
affordable housing target in Rural sub market. At 30% affordable, the
reduction will be a relatively modest 10% reduction in residual.
3.28 At the other end of market scale – in Barry West for example, the range
will be a reduction of 5% at 10% affordable housing to 92% at 30%
affordable housing (a 40% target at an 80%:20% split will generate a
negative residual).
3.29 Thus the Council can be more confident in going for an 80% SR: 20%
HB split in the stronger sub market areas.
Impacts of achieving Code for Sustainable Homes Level 4
3.30 A further consideration in relation to viability is the achievement of a
higher standard of build as envisaged in the Code for Sustainable
Homes.
3.31 There are a number of problems in analysing the impacts of a higher
code (we consider here Code 4) not least that there is a large range of
costs which can impact on a scheme which operate within the same
code.
3.32 The estimated costs of achieving Code Level 4 range from £2,000 to
£12,000 per dwelling (Cyril Sweet, 2007 – Cost Review of the Code for
Sustainable Homes). This depends on the extent to which different
energy sources are adopted. We take here scenario 2 as a broad
indication of costs (an additional £4,260 per end terrace) which
represents ‘Initial energy efficiency measures initially followed by use of
small scale wind turbines and then biomass systems’. We model at
£5,000 per unit; across a scheme at 40 dph this means £200,000 per
hectare taken off residual value.
3.33 Table 3.2 shows the joint impacts of achieving Lifetime Homes
Standards and Code for Sustainable Homes Level 4.
Vale of Glamorgan – Final Viability Report 2010 Page 18
Table 3.2 Residual value (£s million per hectare) with Code for
Sustainable Homes Level 4, at 50 dph (no grant)
East Vale Penarth Barry West
0% AH £3.69 £3.15 £1.25
10% AH £3.22 £2.71 £1.05
20% AH £2.75 £2.28 £0.74
30% AH £2.27 £1.85 £0.45
40% AH £1.80 £1.43 £0.15
3.34 Whilst residual values in the stronger market value areas will hold up,
particularly at the lower percentages of affordable housing, the impact at
higher percentages of affordable housing in the weaker market areas
now becomes substantial. For example at 30% affordable housing,
residual value falls by 45% in Barry West (against Code Level 3)
whereas in East Vale the reduction in residual is only 11%.
3.35 It is important to state with respect to this analysis that it is only a
sensitivity test, and one which increases costs whilst holding all other
variables constant. In practice, it is not improbable that as the CSH
requirements become mainstream, costs will reduce and future selling
prices may have increased by the time the code is introduced thus
allowing viability to be maintained.
Impacts of a higher level of Section 106
3.36 The baseline analysis (Figures 3.1 to 3.5) assumed a Section 106
contribution (in addition to the affordable housing) of £5,000 per unit. A
second test was to be applied at £10,000 per unit.
3.37 If this level of planning gain package was applied then the results would
be the same as in Table 3.2 above. As previously, the consequence will
be that residual values are hit disproportionately hard in the lower value
areas.
Currency of market data
3.38 The analysis set out above relates to current house prices and
development costs (at February 2010). In practice this situation may
vary over the period of the Development Plan and therefore innumerable
scenario tests are possible.
3.39 Figure 3.9 shows the current housing market position in relation to the
long term trend. The chart shows the short term (fluctuating) trend as
‘prices’. The long term trend is plotted by a straight regression linear line
which minimises the variations between the range of price observations.
Table 3.9 Long and short term housing market trends in Wales
Vale of Glamorgan – Final Viability Report 2010 Page 19
Source: Halifax House Price Index
3.40 The chart shows that as at Quarter 4 2009, the market is marginally
under the longer term trend. It is very close to it. Therefore our analysis
has not taken an unrealistically optimistic approach to calculating
residual value. It can be seen that 2007 and 2008 were high points in
the housing market in Wales.
3.41 Another measure is the longer term price and build cost trend. We show
here both variables (for the UK) where it can be seen that over time
viability of development has improved with a widening gap between
prices and costs (Figure 3.10).
Figure 3.10 Long term house price and build costs trends
3.42 In so far therefore, that the housing market replicates in some measure
its former trends, we would expect our analysis to hold for the Plan
Vale of Glamorgan – Final Viability Report 2010 Page 20
period, although we would urge the Council to review the findings in the
medium term to test whether there has been a widening or narrowing in
the relationship between selling prices and development costs.
3.43 Short term fluctuations will need to be dealt with by the Council through
the development control process, ideally using the DAT or other
development appraisal models to reflect any changed circumstances.
Benchmarking results
3.44 There is no specific guidance on the assessment of viability which is
published by national government. In Section 2, we set out that we think
viability should be judged against return to developer and return to land
owner.
3.45 One approach is to take “current” land values for different development
uses as a kind of ‘going rate’ and consider residual values achieved for
the various scenarios tested against these. Table 3.3 shows residential
land values for selected locations across Wales.
Table 3.3 Residential land values regionally
Source: Valuation Office; Property Market Report, July 2009
3.46 The table indicates residential land values of around £1.5m per hectare
for a location such as Bridgend which is probably the nearest
comparable This benchmark is lower than the residual at 40% affordable
housing in Penarth and Dinas Powys for example, although is higher
than the residual generated at 10% affordable housing in Barry West for
example (40 dph scheme). It is likely that expectations for land values
are lower in lower value areas such as Barry.
3.47 The workshop held suggested land values of around £1.3 million per
hectare for the Bridgend area. This is for unserviced green field land.
3.48 Another benchmark which can be referred to is that of industrial land.
Table 3.4 shows values of between £140,000 to £270,000 in the weaker
areas with an overall average for the larger urban areas (Cardiff,
Newport and Swansea as examples) of around £250,000 per hectare.
Vale of Glamorgan – Final Viability Report 2010 Page 21
3.49 Residual Values at 40% affordable housing will clear this figure in Barry
West
Table 3.4 Industrial land values in Wales
Source: Valuation Office; Property Market Report, July 2009
3.50 The ‘benchmark’ of industrial land value can be important where land,
currently in use as industrial land, is being brought forward for residential
development or where sites may be developed either for residential or
employment use.
Vale of Glamorgan – Final Viability Report 2010 Page 22
4 LAND SUPPLY, SMALL SITES AND USE OF COMMUTED
SUMS
Introduction
4.1 This chapter reviews the policy context and options for identifying the size of
sites above which affordable housing contributions would be sought, in the
national policy context.
4.2 The chapter provides an assessment of the profile of the likely future land
supply and the relative importance of small sites. It then considers practical
issues about on-site provision and the circumstances in which collection of a
financial contribution might be appropriate (and the principles by which such
contributions should be assessed).
Purpose of the Analysis
4.3 Evidence on viability is required to demonstrate the robustness of the site size
threshold to be set out in the LDP. The threshold identifies the size of site
above which the LPA can seek affordable housing. TAN2 does not provide
any national guidance on appropriate thresholds and leaves this to LPAs to
identify. However, TAN does comment that,
“When setting site-capacity thresholds and site specific targets local planning
authorities should balance the need for affordable housing against site
viability”. (TAN2 para 10.4)
4.4 By reducing site size thresholds and ‘capturing’ more sites from which
affordable housing can be sought, an authority can potentially increase the
amount of affordable housing delivered through the planning system.
Site supply analysis
4.5 We have analysed data based on granted planning permissions held on the
Council’s Housing Land Availability Database, which the Council uses to
monitor residential development.
4.6 The data relates to the total number of dwellings permitted for each scheme.
The data tested includes information on past and more recently granted
applications and therefore is considered representative of both historical and
current development trends within the Vale. Schemes held on the database
may not be started, are under construction and in some cases have been
completed in part.
4.7 Table 4.1 sets out the overall picture in the Vale. It shows the number and
percentage of dwellings falling under each site size category. Sites of one to
four dwellings are the smallest sites considered; sites with capacity for more
than 100 dwellings are the largest.
4.8 The analysis shows that a significant proportion housing supply is currently
concentrated on larger sites. 31% of new dwellings arise from sites with a
capacity for over 100 homes and 62% of all dwellings from sites with a
capacity for more than 50 homes.
4.9 In this and the analysis that follows, we have excluded proposals at Barry
Waterfront and at Rhoose. These sites are exceptionally large in the context
of the Vale and would, if included, tend to distort the analysis.
Vale of Glamorgan – Final Viability Report 2010 Page 23
Table 4.1: No of dwellings in different sizes of sites
Site Size No of Dwellings % of Total
1 to 4 629 15.20
5 to 9 258 6.24
10 to 14 215 5.20
15 to 24 288 6.96
25 to 49 171 4.13
50 to 100 1310 31.67
> 100 1266 30.60
0
4137 100.00
Source: Vale of Glamorgan Council
4.10 However, a significant number of dwellings emanate from smaller sites. Very
small sites (one to four dwellings) supply 15% of all new homes and over 25%
(26.6%) are on sites of less than 15 dwellings.
4.11 Table 4.2 shows the same analytical framework but with a focus on the two
main settlements – Barry and Penarth.
Table 4.2: No of dwellings in different sizes of sites: Barry and
Penarth
Site Size No of Dwellings % of Total
1 to 4 295 9.29
5 to 9 174 5.48
10 to 14 131 4.13
15 to 24 140 4.41
25 to 49 171 5.39
50 to 100 979 30.83
> 100 1285 40.47
3175 100.00
Source: Vale of Glamorgan Council
4.12 The table shows that there is greater reliance on large sites than for the Vale
as a whole. For example, over 70% of all new dwellings will be developed
(2005 to 2009) on sites of more than 50 dwellings.
4.13 Around 20% of all new dwellings will be developed on sites of less than 15
dwellings. This is less than for the authority as a whole where the
corresponding figure (Table 4.1) was 26%.
Vale of Glamorgan – Final Viability Report 2010 Page 24
4.14 Table 4.3 shows the same analytical framework but with a focus on the four
main towns excluding Barry and Penarth. These are Dinas Powys, Llantwit
Major, Cowbridge and Rhoose.
Table 4.3: No of dwellings in different sizes of sites: Dinas Powys,
Llantwit Major, Cowbridge and Rhoose.
No of % of
Site Size Dwellings Total
1 to 4 131 26.10
5 to 9 36 7.17
10 to 14 60 11.95
15 to 24 65 12.95
25 to 49 0 0.00
50 to 100 210 41.83
> 100 0 0.00
502 100.00
Source: Vale of Glamorgan Council
4.15 The table shows that there has been greater reliance on smaller sites within
these towns than for the Vale as a whole and in the two major settlements of
Barry and Penarth. For these four locations, approaching 50% (45%) of all
dwellings granted permission are on sites of less than 15 dwellings. Nearly
60% of all dwellings on sites of less than 50 dwellings.
4.16 Table 4.4 shows the same framework but looking now at the remaining rural
settlements (all settlements other than those included in the three categories
above).
Table 4.4: No of dwellings in different sizes of sites –rural settlements
No of % of
Site Size Dwellings Total
1 to 4 200 43.48
5 to 9 47 10.22
10 to 14 22 4.78
15 to 24 67 14.57
25 to 49 0 0.00
50 to 100 124 26.96
> 100 0
460 100.00
Source: Vale of Glamorgan Council
Vale of Glamorgan – Final Viability Report 2010 Page 25
4.17 This table shows a greater reliance on smaller sites as previously (main
towns), with almost 60% of dwellings originating on sites of less than 15
dwellings and over 40% on sites of less than five dwellings.
4.18 The analysis shows clearly the different picture for different size settlements
with larger settlements relying more on larger sites than smaller ones. This
provides the basis for differential threshold levels reflecting the ability of the
current flow of planning consents to provide qualifying sites for affordable
housing delivery.
Management of affordable housing
4.19 We discussed the suitability of different site types (including small sites) for
affordable housing at the workshop with the development industry and which
included representatives from developers and Registered Social Landlords
(RSLs).
4.20 Neither small nor large sites were considered to be more economically viable
to develop on a systematic basis. Small sites might not attract the economies
of scale of larger schemes but, on the other hand, small sites can be relatively
easy and quick to develop.
Use of commuted sums
4.21 As a general principle, we recognise that seeking on-site provision of
affordable housing will be the first priority, in accordance with national
planning guidance which encourages the promotion of mixed communities,
and that provision of affordable housing on an alternative site or by way of a
financial payment in lieu (or commuted sum) should only be used in
exceptional circumstances.
4.22 Our approach is that the commuted sum should be equivalent to the
‘developer/landowner contribution’ if the affordable housing was provided on
site. One way of calculating this is to take the difference between the residual
value of 100% market housing and the residual value of the scheme with the
relevant percentage and mix of affordable housing.
4.23 If the ‘equivalence’ principle is adopted, then the decision of the local authority
to take a commuted sum will be based on the acceptability or otherwise of on-
site provision as a housing and spatial planning solution.
Potential reductions in Section 106 obligations
4.24 Any concerns about scheme viability (whatever size of site) should be reflected
by providing grant or altering tenure mix, or by a ‘reduced’ affordable housing
contribution whether provided on-site, off-site or as a financial contribution.
Other planning obligations may also need to be reduced under some
circumstances where there is planning merit and / or public interest in the site
being developed
Vale of Glamorgan – Final Viability Report 2010 Page 26
5 CASE STUDY VIABILITY ANALYSIS
Introduction
5.1 The analysis in Chapter 3 provides a good indication of the likely viability of
sites in the Vale of Glamorgan. The residual values can be compared with
existing use values to establish whether land owners are likely to make a
return over and above existing use value, taking into account a developer
margin.
5.2 The analysis in Chapter 3 will apply for large as well as small sites (on a pro
rata basis). We do not have any evidence from this or related studies to
suggest that the economics change significantly between large and small
sites.
5.3 It will be noted (Table 3.7) that small sites can achieve higher land values
than larger ones, suggesting that the economics of developing smaller sites
could actually be more favourable than developing larger ones.
5.4 In theory therefore there is no real need to review in detail viability issues for
small sites. However, for the sake of further illustration, and recognising that
there may be special circumstances which impact on the viability of some
types of smaller sites, it was felt helpful to review the development economics
of some illustrative case studies.
Case study sites
5.5 In this section we review a number of case study developments which are
examples of small sites for residential development. This is based on
information held on the Council’s Housing Land Availability database. The
data implicitly includes windfall developments and hence should provide a fair
indication of the pattern of supply going forward.
Figure 5.1 Incidence of planning permissions
Source: Vale of Glamorgan Council
Vale of Glamorgan – Final Viability Report 2010 Page 27
5.6 Figure 5.1 shows the range of scheme types within the Vale. The
development of a single dwelling is a very significant source of supply in the
Vale area. We understand this to be on residential or residential amenity land
– gardens, back land and infill development. These sites make up 50% of all
incidences of planning permission and hence are highly significant in terms of
the overall picture of housing supply.
5.7 Schemes of one unit (in various forms) are significant in the Vale area. 56%
of all incidences of planning permission involve the provision of one dwelling.
We are unsure what proportion of these schemes involves the demolition of a
dwelling. We estimate, from experience of similar authorities in South Wales,
that ‘one for one’ schemes will not make up a significant proportion of supply.
5.8 Schemes of two dwellings on residential amenity land (gardens, infill plots)
make up almost 10% of all incidences of planning permission and similar
schemes involving the construction of three to five dwellings make up another
7% of all incidences.
5.9 There are a range of smaller schemes coming forward utilising sites in
commercial use. These include builder’s yards and garage land. There are
also a number of sites emanating from agricultural land and building (notably
barn conversions). We do not believe these sites are significant in the wider
picture of housing supply in the Vale although it should be stated that some
types of schemes, particularly those involving conversion may prove in some
instances less viable than new build. The Council will need to consider these
schemes using the DAT or other development appraisal model on a site by
site basis.
5.10 On the basis of the planning data, we have selected three case studies for
further investigation. These are shown in Table 5.1
Table 5.1 Case study sites
Case Number of Type of new development Site Size Resulting
Study dwellings (Ha) density
A 1 1 x 5 bed detached house 0.05 20
B 3 1 x 4 bed detached house; 0.1 30
2 x 3 bed terraced houses
C 5 1 x 4 bed detached house; 0.125 40
2 x 3 bed detached house;
2 x 3 bed terraced houses
5.11 For each case study we have undertaken an analysis of residual values at
levels of affordable housing from 0%; 10%; 20%, 30% and 40%. We have
selected Rural, Penarth & Dinas Powys, Barry West and Barry East. The
results for Penarth and Dinas Powys will provide a conservative proxy for
those for East Vale and the results for Barry West will provide a good proxy
for those for Rural South and Coast. All the other assumptions used are the
same as for the main analysis described in Chapter 3.
5.12 We have assumed no grant in all scenarios tested here.
Vale of Glamorgan – Final Viability Report 2010 Page 28
Case study A – Develop one detached house on a 0.05 ha site
5.13 The first scenario assumes the development of one five bed detached house.
The results, with the affordable housing impacts are shown in Table 5.2:
Table 5.2 Develop one five bed detached house
Case A AH0% AH10% AH20% AH30% AH40%
Rural £266,000 £244,000 £221,000 £199,000 £177,000
£5.32 £4.88 £4.42 £3.98 £3.54
Penarth &
Dinas Powys £206,000 £222,000 £170,000 £153,000 £135,000
£4.12 £4.44 £3.40 £3.06 £2.70
Barry West £122,000 £111,000 £99,000 £88,000 £75,000
£2.44 £2.22 £1.98 £1.76 £1.50
Barry East £74,000 £66,000 £58,000 £50,000 £41,000
£1.48 £1.32 £1.16 £1.00 £0.82
AH = affordable housing percentage
Table shows residual values in a selection of market value areas: the upper figure is the
residual value for the scheme and the lower figure is the equivalent residual value per hectare
(in £s million)
5.14 Table 5.2 shows residual values at the different proportions of affordable
housing. Positive residual values are achieved in all four sub markets. The
results show residual values on a per hectare basis above £3.5 million per
hectare at 40% affordable housing in the Rural sub market. In the weakest
sub market, Barry East, a residual value of £1 million per hectare is achieved
at 30% affordable housing.
5.15 Where one dwelling of this type is built on infill or back land sites, we would
expect there to be a sizeable uplift in site value in the higher value areas,
although at 40% affordable housing in a location such as Barry East, the
actual return to land owner may not offset any devaluation to the existing
house that could occur as a result of a new dwelling being built in say a
garden.
5.16 This type of development is unlikely to be viable where the scheme involves
the demolition of an existing dwelling. Acquisition costs are likely to be too
high in most cases, although it should be stated that the planning showed that
in some instances the existing dwelling was derelict and hence could probably
be acquired at a relatively low value.
Case study B – Develop three houses (one detached and two terraces)
on a 0.075 ha site.
5.17 The viability of developing houses rather than one will depend on the site size
and existing use value. There will be some instances where the relationship
between existing use value and residual development value is favourable and
Vale of Glamorgan – Final Viability Report 2010 Page 29
some where this may not be the case. Table 5.3 shows residual values for
the development of three dwellings.
Table 5.3 Develop three dwellings
Case A AH0% AH10% AH20% AH30% AH40%
Rural £421,000 £373,000 £328,000 £280,000 £233,000
£4.21 £3.73 £3.28 £2.80 £2.33
Penarth &
Dinas Powys £333,000 £292,000 £252,000 £211,000 £171,000
£3.33 £2.92 £2.52 £2.11 £1.71
Barry West £161,000 £133,000 £106,000 £77,000 £50,000
£1.61 £1.33 £1.06 £0.77 £0.05
Barry East £81,000 £59,000 £38,000 £15,000 -£6,000
£0.81 £0.59 £0.38 £0.15 -£0.00
AH = affordable housing percentage
Table shows residual values in a selection of market value areas: the upper figure is the
residual value for the scheme and the lower figure is the equivalent residual value per hectare
(in £s million)
5.18 For infill, back land and garden plots, as in the previous case study, there will
be considerable uplift in land value in the higher value areas.
5.19 The results show here a higher density. Generally this scenario, as a small
scheme, generates lower residuals on a per hectare basis than at the 20 dph.
However, substantial returns are nevertheless achieved up to 30% affordable
housing with the exception of Barry East, where at 30% affordable housing
the residual is £150,000 per hectare with a plot value of £15,000.
5.20 The residuals generated here are generally not sufficient to support an
affordable housing contribution where two dwellings replace one. In Barry
West for example, even where a unit for outright sale is considered, the
residual is £161,000 which is unlikely in many instances to generate enough
to purchase an existing property.
5.21 Much does depend on development mix. If we were to test for example, three
detached houses, we would expect to see similar results to those in Table 5.2
on a per hectare basis.
Case study C – Develop five houses (three detached and two terraces)
on a 0.125 ha site.
5.22 The viability of developing houses rather than one will depend on the site size
and existing use value. There will be some instances where the relationship
between existing use value and residual development value is favourable and
some where this may not be the case. Table 5.3 shows residual values for the
development of three dwellings.
Vale of Glamorgan – Final Viability Report 2010 Page 30
Table 5.3 Develop five dwellings
Case A AH0% AH10% AH20% AH30% AH40%
Rural £775,000 £694,000 £611,000 £530,000 £448,000
£6.20 £5.55 £4.89 £4.24 £3.58
Penarth &
Dinas Powys £599,000 £531,000 £461,000 £393,000 £323,000
£4.79 £4.25 £3.69 £3.14 £2.58
Barry West £315,000 £268,000 £219,000 £172,000 £124,000
£1.52 £2.14 £1.75 £1.37 £0.99
Barry East £171,000 £135,000 £97,000 £60,000 £22,000
£1.37 £1.08 £0.77 £0.48 £0.17
AH = affordable housing percentage
Table shows residual values in a selection of market value areas: the upper figure is the
residual value for the scheme and the lower figure is the equivalent residual value per hectare
(in £s million).
5.23 The development of five units on the basis of this site size (equivalent density
40 dph) generates substantial residual values across most scenarios. On a
per hectare basis the residuals are higher than those in Case Study B,
although the interpretation of any ‘general lessons’ would need to be looked at
in the context of development mix.
5.24 Where the existing use value of a site is industrial, then all sub markets with
the exception of Barry East (at 40% affordable housing), should generate
residual values above existing use.
5.25 Where five dwellings replace an existing house, then in the higher value sub
markets, we believe that the Council may be able to justify affordable housing
contributions up to 40%. In the lower value areas, we believe that a
contribution higher than 20% is likely to be challenging.
Commentary on the results
5.26 This section on case studies is primarily illustrative, looking at the economics
with particular reference to smaller sites and including consideration of
achieved residual values for different sites and how they compare with
existing use values.
5.27 The results for the small sites reflect in large measure, the previous analysis
which considered the notional 1 hectare site. This analysis however shows
more clearly the focus that is needed on location, rather than site size.
Residual values on a per hectare basis do not vary significantly between the
one hectare examples and the smaller sites tested here.
5.28 The analysis shows that the smallest development (case studies of one and
three dwellings) can generate positive residual values in the higher value sub
markets.
Vale of Glamorgan – Final Viability Report 2010 Page 31
5.29 As previously stated with respect to the High Level Testing, scheme viability is
significantly enhanced by grant and the Council will need to think about this
solution, particularly with a focus on the weaker sub market areas.
5.30 It will be noted that we have not tested the two major sites at Barry Waterfront
or at Rhoose. We understand that the former will be tested via a bespoke
study and the latter as and when the site is brought forward to planning.
Vale of Glamorgan – Final Viability Report 2010 Page 32
6 MAIN FINDINGS AND CONCLUSIONS
Key findings
6.1 There were six housing sub markets defined within the Vale of Glamorgan
Council’s area. These are: Rural (including Cowbridge), East Vale, Penarth
and Dinas Powys, Rural South and Coast, Barry West and Barry East. These
sub markets are based on an analysis of postcode sectors and were agreed
with the local authority and the developer workshop. The sub markets are
closely aligned with the sub markets utilised in the Local Housing Market
Assessment.
6.2 Market values vary significantly between these areas. These differences in
market values were reflected in differences in residual values (for the different
scenarios tested). We found that residual value is dependent not only on
location but also on the density adopted.
6.3 The Vale of Glamorgan is split quite starkly in viability terms between the
Rural, East Vale and Penarth (and Dinas Powys) sub markets on the one
hand, and the Rural South Coast and Barry (West and East) on the other.
The difference between these two main areas is very significant. A 40%
affordable housing target in Penarth for example provides a higher residual
value than in Barry West at 100% market housing (40 dph scheme). These
very significant differences lend support to a policy response which reflects a
split target operating within the Vale.
6.4 Residual values are very buoyant in the higher value locations. We would
expect schemes coming forward in the Rural sub market to generate residual
values in excess of £2 million per hectare at around 40 dph. In Barry West –
the higher value area of the town, residual values at 40% affordable housing
are in excess of £500,000 per hectare. This is in excess of industrial land as
a potential competing use.
6.5 Our analysis suggests that development would appear most viable around 30
dph to 40 dph, with the optimal situation then being dependent on location. At
higher densities, lower house price areas will not deliver Section 106 as well
as they would do at lower density.
6.6 The introduction of grant significantly improves residual values across the
area. It is applied most efficiently however in the lower value areas where in
Barry East for example residual value is almost three times that at 100%
market housing. This is in no small measure due the fact that the value of
(100%) ACG is very generous at 100% relative to house prices in the weakest
sub market areas. For example the (100%) ACG level (5) is £166,300 for a 3
bed terraced house whereas the open market price is only £130,000.
6.7 The analysis shows that SHG actually increases residual values as the
proportion of affordable housing is increased in Rural South and Barry (West
and East). In the three higher value locations, residual values fall as
affordable housing is increased within a scheme despite there being SHG
assistance.
6.8 Viability is highly sensitive to the relationship between existing (or, where
relevant, alternative) use value. Our analysis suggests that sites will be
brought forward on variety of different types of sites. The analysis suggests
that many of the smaller sites will be brought forward on existing use values
which are low – in particular residential and residential amenity land.
Vale of Glamorgan – Final Viability Report 2010 Page 33
6.9 However, some sites will be delivered within commercial areas and on land
which is in current industrial use. Existing use values here are likely to be
higher.
6.10 Our analysis suggests that small sites are not problematic in terms of viability.
Rather it is the specific location and nature of development (eg new build
and/or demolition) that will be the key factor in determining viability.
6.11 From a housing management perspective, we did not find any in-principle
objections to the on-site provision of affordable housing on small sites. There
may be particular schemes where on-site provision is not the preferred option,
but as a general rule, on-site provision of small numbers of affordable homes
is acceptable to a housing association.
6.12 The analysis indicates that for the Vale of Glamorgan as a whole, large sites
are significant in providing housing supply. This picture is not significantly
different where Barry and Penarth, as the two key settlements are considered.
As may be expected (consistent with other local authority areas), in the rural
areas, there is higher reliance on small sites (less than five dwellings) to bring
housing forward.
6.13 Where a financial payment in lieu of on-site provision of affordable housing (or
commuted sum) is to be sought, it should be of “broadly equivalent value”.
This approach is, on the evidence we have considered, a reasonable one to
take in policy terms.
6.14 If this ‘equivalence’ principle is adopted, then the decision of the local
authority to take a commuted sum will be based on the acceptability or
otherwise of on-site provision as a housing and spatial planning solution, not
in response to viability issues.
6.15 Whilst the current market circumstances are less favourable in terms of house
prices than was the case two to three years ago, development costs have
also fallen to some extent, cushioning the impacts on land value.
6.16 Significantly, the longer term trend for house prices, and indeed the
relationship between house prices and build costs, suggests that this analysis,
carried out in February 2010 is ‘conservative’ in nature, not over estimating
the potential for Section 106 contributions over the period of the Plan.
Conclusions and policy options
6.17 There is no detailed government guidance setting out how targets should be
assessed, based on an assessment of viability. An assessment of viability for
policy setting purposes might have reference to a range of factors including:
past and recent delivery of affordable housing, residual values, the
relationship between residual values and existing use values, what has been
found to be robust targets in similar authorities through the Core Strategy
process, the land supply equation and its relationship to be policy weight
given to affordable housing delivery in the wider context of housing supply
generally. To some extent land owner expectations are also significant. The
experience of the consultant, working in conjunction with the local authority
and through developer workshops helps to arrive at a robust policy stance.
6.18 From this review, we have highlighted the considerable variation in residual
values achieved across the Vale and in particular the viability divide between
the Rural, East Vale and Penarth (and Dinas Powys) sub markets on the one
hand, and the Rural South Coast and Barry (West and East) on the other.
Vale of Glamorgan – Final Viability Report 2010 Page 34
This pattern has important consequences for the way we have framed the
options for the targets for affordable housing which we set out below:
• A single target for the Vale of Glamorgan area. This could reasonably be
set at 30% but recognising that this would be challenging in the weaker
sub markets and probably not challenging enough in the higher value
(mainly rural) areas.
• A split target which seeks 40% affordable housing in Rural, East Vale and
Penarth (and Dinas Powys) and, 30% affordable housing in Rural South
and Coast and Barry (West and East).
6.19 With respect to the options above, we would be clearly advocating a split
target which does not fall in line with the single target (30%) adopted in the
Council’s SPG of April 2009. However, we believe that if practical, the
Council should go for a split target reflecting the very significant differences
between the sub- markets analysed in the report.
6.20 A 30% target in Barry in particular will be deliverable at lower densities rather
than higher ones. The Council will need to adopt a more flexible approach in
Barry on higher density schemes accepting that smaller units do not tend to
maximise residual values.
6.21 That having been stated, there will be hot spots in what are apparently weaker
sub markets and cold spots in what are ostensibly higher value sub markets.
6.22 A 30% target in Rural South and Coast and Barry may also in some instances
require SHG to be applied in order to bring residual values above existing use
values. This will often be the case in Barry East but may also be the case
elsewhere in higher density schemes in these weaker sub markets.
6.23 The second option, if adopted, should allow the policy to adjust to local market
drivers in a more precise way, reflecting the significantly greater potential for
high value areas to make significant affordable housing and other Section 106
contributions. But the Council would then need to be clear that they can
identify the areas clearly where the differential targets might operate.
Viability on individual sites
6.24 Our analysis has indicated that there will be site-specific circumstances where
achievement of the affordable housing proportions set out above may not be
possible or where development exceeds the proposed targets. This should
not detract from the robustness of the overall targets but the council will need
to take into account specific site viability concerns when these are justified.
6.25 If there is any doubt about viability on a particular site, it will be the
responsibility of the developer to make a case that applying the council’s
affordable housing requirement for their scheme makes the scheme not
viable. Where the council is satisfied this is the case, the council has a
number of options open to it (including changing the mix of the affordable
housing and supporting a bid for grant funding from the WAG/or using their
own funds) before needing to consider whether a lower level of affordable
housing is appropriate. In individual scheme negotiations, the council will also
need to consider the balance between seeking affordable housing and its
other planning obligation requirements and wider strategic planning issues.
Vale of Glamorgan – Final Viability Report 2010 Page 35
Thresholds
6.26 Housing policy 12 of the adopted Local Plan requires affordable housing
contributions on substantial developments which are stated to be over 50
dwellings. The Affordable Housing Delivery Statement (AHDS) sets the
threshold at 10 units or more or on sites of greater 0.3 hectares.15 or more
dwellings on sites of more than 0.5 hectares.
6.27 The analysis of this report, taking into account the case studies and feedback
from the workshop, suggests that small sites do not systematically present
viability challenges in comparison to larger sites. In other words, there is no
significant evidence against the Council reducing thresholds below 10 on
viability grounds. We would support the Council if it chose to reduce
thresholds below 10 as set out in the AHDS.
6.28 The analysis of development across the Vale suggests a relatively high
reliance on larger sites with 62% of all units being developed on sites of more
than 50 homes. This analysis excludes the two major sites at Barry
Waterfront and Rhoose which will, as we understand it, qualify to provide
affordable housing. The Council will need to weigh up this situation, for or
against a lower threshold across the Vale in the light of what is deliverable at
Barry Waterfront which we understand is being independently appraised by
the Council.
6.29 There is a good case for a split threshold should the Council decide to adopt
this approach. This would recognise that the main towns (excluding Barry
and Penarth) and the rural areas rely more significantly on smaller sites and
hence if affordable housing is to be delivered there, then a lower threshold
(less than 10 dwellings) might be appropriate. In the main towns, 26% of the
supply emanates from sites of less than 5 dwellings, and in the smaller rural
settlements this figure rises to 43%. On this basis, the Council may justifiably
consider a nil threshold (i.e. one gross unit triggering an affordable housing
contribution).
6.30 In conclusion, and recognising the particular challenges likely to be presented
by developing in Barry town itself, we would recommend that the Council
adopt the 10 threshold set out in the AHDS in Barry and Penarth and a nil
threshold elsewhere in the Vale of Glamorgan area.
Commuted sums
6.31 Where commuted sums are collected a possible approach to calculating the
appropriate sum sought is to base this on the equivalent amount which would
be contributed by the developer/landowner were the affordable housing
provided on site. This is expressed as follows:
RV 100% M = Residual value with 100% market housing
RV AH = Residual value with X% affordable housing (say 40%)
Equivalent commuted sum = RV 100% MV minus RV AH
6.32 Where commuted sums are collected, the council will need to have in place a
strategy to ensure the money is spent effectively and in a timely manner.
Options for spending will be a matter for the council to consider but could
include supporting schemes which would otherwise not be viable, increasing
Vale of Glamorgan – Final Viability Report 2010 Page 36
the amount of social rented housing in a scheme, increasing the proportion of
family units in a scheme, seeking higher quality affordable housing (e.g. a
higher level of the Code for Sustainable Homes).
Monitoring
6.33 This study is intended to be robust for the period of the LDP. The Council’s
affordable housing targets have been set with the longer (Plan period) term in
mind.
6.34 It will inevitably be the case in some instances that the policy target or targets
cannot be met because site circumstances vary from the norm (at local
authority or sub market level). In these situations the Council has at its
disposal the Development Appraisal Toolkit (DAT) which it may use to
negotiate (if appropriate) a lower quantum of affordable housing than policy
requires. The Council have received training in the use of the Toolkit and are
hence in a position to adopt a flexible but appropriate approach where
needed.
6.35 The Council have ensured that the Toolkit has been kept up to date since its
inception for use in 2006. It is understood that the Council will continue to
maintain the DAT over the period of the Plan. Doing so will allow the Council
to both negotiate schemes with developers using current data as well as re-
visit the Plan policies at an interim point in time should this prove an
appropriate step.
Vale of Glamorgan – Final Viability Report 2010 Page 37
Appendix 1
VALE OF GLAMORGAN AFFORDABLE HOUSING VIABILITY STUDY –
WORKSHOP
Workshop Notes
A workshop was held on the afternoon of 2nd December 2009 at the Council Offices
in Barry. Representatives of the development industry, landowners and RSLs were
in attendance. A full attendance list is given below.
Attendance: Organisation:
Victoria Bolton Newydd Housing Association VB
Paul Wyatt Wales & West Housing Association PW
Dafydd Cantwell Hendre Ltd DC
Richard Price Home Builders Federation RP
Matthew Shellum McCarthy & Stone Retirement Lifestyle MS
John Mathews Lovell JM
Jon Harvey Persimmon JH
Richard Keogh Persimmon RK
Richard Cresswell Taylor Wimpey RC
Gareth Williams Home Builders Federation GW
Emma Harvey Vale of Glamorgan Council EH
Mike Ingram Vale of Glamorgan Council MI
Andrew Wallace Vale of Glamorgan Council AW
Lucy Turner Vale of Glamorgan Council LT
John Raine Vale of Glamorgan Council JR
Victoria Abraham Vale of Glamorgan Council VA
Andrew Golland Three Dragons AG
Three Dragons and The Vale of Glamorgan CBC would like to thank all those in
attendance for their inputs to the study.
At the workshop Three Dragons gave a presentation summarising the methodology
and outlining the process of higher level and detailed testing which would be carried
out to determine viability targets.
It was agreed that the Powerpoint presentation (attached) would be made available
to all Workshop participants in conjunction with these feedback notes.
1 Introduction
Three Dragons has been commissioned to carry out an Affordable Housing Viability
Appraisal in accordance with the requirements of TAN2 in order to establish a robust
evidence base to support emerging policy requirements as set out in the LDF.
There are two parts to the commission:
i) An Affordable Housing Viability Study to guide the setting of new affordable
housing targets and thresholds for the Local Development Plan;
ii) A Financial Appraisal Toolkit to assist negotiations on specific sites.
Vale of Glamorgan – Final Viability Report 2010 Page 38
EH outlined the purpose of the meeting was to discuss strategic policy and the
overall methodology. The purpose of the study was to support the evidence for
realistic and accurate policies which reflect the conditions of the general areas to
reflect brownfield / greenfield sites.
2 Basis for interpreting viability
AG outlined the methodology of the viability model which is based upon scheme
revenue versus development Costs (including developer margin and S106
agreements). The model works on assumptions of what a reasonable return to the
land owner e.g. – 30% returns for brownfield land.
Most were agreed in principle to the over-riding method for assessing viability
proposed by Three Dragons. This measures viability by reference to residual
scheme value less the existing or alternative use value of a site.
However, it was suggested that an alternative measure of viability should look at the
ratio of the site value to gross development value (GDV). RC noted 18 – 20% of
GDV as a guide. AG stated that Three Dragons would not normally look at viability
in this way although the analysis will comment on the ration where feasible.
JM suggested that investment value might require a greater than 30% return above
existing use value, but also noted that a GDV down to 18% uplift could be workable
in some instances.
It was noted that Denbighshire’s assessment used industrial land values and that
this created methodological problems. AG clarified this study is similar to the Sewspg
methodology. AG also noted the point in time in which the assessment is undertaken
is important.
3 Overall methodology
Three Dragons explained that the approach to the study will be two stage with the
first stage focusing on testing a notional one hectare site, assuming different
development mixes and different percentages of affordable housing, with the second
stage looking at a range of generic site types, ranging from large green field through
to small and large brown field sites.
Participants at the workshops generally supported the approach set out (see also
Powerpoint which explains the approach diagrammatically). Three Dragons replied
that this was an approach which has been accepted elsewhere at Core Strategy
Exam and is also adopted in the SEWSPEG Good Practice Guide.
Data sources (e.g. HMLR for house prices and BCIS for build costs) were explained
to participants. The need for best primary data sources based on a large sample
was understood and agreed.
AG requested details of typical sites which could be tested within the study.
4 Sub markets and market values
A key part of the study will involve the analysis of viability at a sub market level. Sub
markets will be defined primarily by house prices. The Powerpoint presentation
Vale of Glamorgan – Final Viability Report 2010 Page 39
shows a table of areas. Participants were invited to submit comments on
submarkets by email to the Council.
It was explained by Three Dragons that prices were derived from three years worth
of HM Land Registry data and then adjusted to today’s values. AG clarified that the
prices are indicative of new build for December 2009.
AG explained the intention of the submarket area analysis could be to provide
different area policy recommendations to the Council which reflect any house price
differences.
It was noted that the HBF might be able to provide price data from their database.
Some questioned the market prices for the Barry area – EH explained western areas
of Barry would increase the average market figure. EH also noted that 70% of the
population in the Vale of Glamorgan is within the Barry waterfront strip. It was then
discussed that Barry could be an interesting case of high need and possibly low
viability.
There was general expectation that there would be a different policy approach due to
the nature of the housing market in the Vale. VB suggested the sub market areas
should reflect the LHMA study. AG stated this would be an LPA policy judgement.
Whilst some welcomed the Barry and Penarth policy and there was general
acceptance of the submarket area prices, others stated they would provide further
comment after reviewing the data with their colleagues.
All – please note – prices and market areas are included in the Powerpoint
Presentation.
5 Land values
The ‘typical Vale land owner’ was initially discussed – seen as prosperous land
owners or farmers with high expectations. The Vale is also seen as an area with
relatively high demand.
Delegates were asked what they thought current land values were. As follows:
For good, serviced greenfield site: £1m – 1.25 / acre (circa £2.8 million per hectare)
Unserviced greenfield: between £500,000 - £600,000 (circa £1.3 million per hectare)
Concern was raised regarding District Valuer (DV) studies’ where land values can be
up to 6 months old and based upon questionable assumptions.
It was noted that agricultural land values are increasing at present – previously
around £2K per acre but increasing to £5 to 7K per acre. Some suggested this,
together with demanding affordable housing / S106 agreements, could lead to
developers postponing development for a few years.
6 Density and development mix
AG set out the suggested range of schemes which the DAT will test. These ranged
from 30, 35, 40, 50, 75, and 100 dph.
Vale of Glamorgan – Final Viability Report 2010 Page 40
PW noted that flatted developments are not required in terms of need. GW agreed
that the proposed mixes seem to cover the ranges but noted that the market is not
currently at the higher end. RC noted that flatted developments are not popular with
large house builders currently, but agreed there is some potential for flatted
developments in the future.
There was some discussion around the usefulness of the 35 dph mix and AG
suggested the tested ranges could be changed to 30 – 40 – 50
A revised development mix: density table is included with the Powerpoint
Presentation.
7 Thresholds and the viability of smaller sites
AG set out the policy position within TAN 2 (citing Para 10.4). AG noted that the
evidence produced could indicate there is a need for a zero threshold across the
Vale.
JH noted that at lower thresholds, commuted sums are sometimes seen as the best
way of dealing with viability issues (comment not specifically directed towards the
Vale). RP suggested commuted sums for sites under 10 units.
GW raised concerns over small site provisions. He noted that the thresholds depend
upon the sources of supply and questioned the approach used within the Poole and
Bournemouth study.
Viability of small sites was discussed. Issues particularly cited were developments in
gardens and redevelopment of sites involving demolition. AG suggested that it is the
existing use type which is the issue, not site size.
Small site contributions were discussed. Such contributions could be ring fenced to a
particular community. RC and JH questioned whether it is fair to tax land owners of
smaller sites. RC raised concerns that a 50% requirement on small sites might stifle
development. GW suggested a small site allowance to address this.
JM noted there is a three unit contribution threshold in Neath Port Talbot and
discussed the importance of contributions on brownfield sites in relation to
regeneration.
AW stated there was a need to test a 0% threshold to ensure the process stands up
to scrutiny and the test of soundness at EiP. AG stated one of the purposes of
holding the meeting and testing such thresholds was ascertain where the limit is.
RP noted the inspector’s comments at the Merthyr Tydfil LDP EiP which indicated
the local authority needs proof that is has explored all viable options – inspector said
one extra house is preferable to no affordable housing provision.
8 Calculation of commuted sums
AG stated that any commuted sum should be the difference between the residual
value of a scheme with 100% market housing and one with a mix of market and
affordable housing.
Vale of Glamorgan – Final Viability Report 2010 Page 41
MS stated that if there is payment on commencement of development, the overall
costs of development increase. EH stated this is up to developers to negotiate.
PW and AH argued commuted sums needed to be reviewed. PW also questioned
whether schemes including 100% affordable housing should have to pay Section
106 costs.
AG questioned whether there is a management issue on small sites. RSLs did not
think generally there were, but SM confirmed that on-site affordable housing
provision can be an issue for specialised/sheltered housing.
9 Development costs
Three Dragons presented the proposed page that will be used for the testing
framework. This is included in the Powerpoint presentation. It was explained that
the base build costs per square metre will be calculated from the BCIS data source.
AG clarified costs based on 3rd quarter 2009 BCIS England and Wales figures
adjusted for the Vale. The other development costs (professional fees, internal
overheads, profit margins, etc) are however those which Three Dragons intend to
use for base viability testing.
It was stated that Three Dragons will test the analysis at a 17% return rate on gross
development value for the market element of a scheme and at 6% for the affordable
element of a scheme – unless developers can provide evidence to the contrary. It
was stated that 17% is not enough in the current market, but may be correct long
term.
MS suggested increasing the return on GDV to 20%. JM noted that higher density
sites might need a higher margin due to cash flow and time required to sell.
Given feedback, Three Dragons will test at 17% on GDV as the baseline, and with a
test at 20% on GDV as an alternative scenario. Feedback please.
EH noted that housing sites will be phased throughout the plan period and a long
term policy stance is required to avoid peaks and troughs.
There was discussion surrounding current and future costs with no consensus on the
direction of the market. It was noted that smaller developers may find it harder to
raise capital. RP noted that substantial returns are required to get finance.
Code for Sustainable Home (CSH) costs were discussed. It was suggested Code 3
costs are currently reflected in the BCIS build costs as these reflect RSL schemes
and it is understood that recent RSL schemes will be built to Code 3 Level.
RP stated the costs of the CSH from research undertaken for the DCLG by the UK
Zero Carbon Hub. For energy only these were:
Code 3 – minimum £6k per plot
Code 4 – £10k per plot
Code 5 – £25K per plot
Vale of Glamorgan – Final Viability Report 2010 Page 42
AG stated Code 4 would be required by next year and RP noted Code 3 + 6 credits
were introduced on 1st September 2009. It was also noted that building regulations
may be devolved by 2011.
It was accepted that this is a difficult area and is somewhat a moving ‘feast’. Three
Dragons point out that the viability of development cannot be measured by costs
alone, since future revenue could balance future costs.
It is suggested that the study assumes additional costs of both £5,000 per unit and
£10,000 per unit to achieve Code Level 4 – and test both scenarios.
10 Section 106 costs (in addition to affordable housing)
VA outlined the background to the S106 Planning Obligations SPG which requires
£10,000 per unit on the assumption there is no provision within the proposal on site
or any local provision.
The average provision is around £3,000 per unit with small / medium sized sites
having lower contributions.
RC noted that in effect larger sites may subsidise the smaller proposals. EH made
the point that 7,500 units are required over the plan period and it is anticipated that
the majority of this figure will be met on sites of 10 or more units.
PW questioned whether other planning obligations are likely to be sort in addition to
affordable housing units which VA confirmed.
On the basis of the above discussion, Three Dragons suggest two tests within the
study:
£5,000 per unit (baseline)
£10,000 per unit (higher level test)
Please can delegates feed back on this, thanks.
11 Affordable housing tests and issues
AG suggested a range of policy scenarios which should be tested and questioned
whether they were reasonable for the LDP plan period and the various areas of the
Vale.
These were: 10%, 15%, 20%, 25%, 30%, 35% and 40% based on 65% Social Rent
and 35% Homebuy.
MI noted that RSLs tried to sell 70/30% split Homebuy packages, which didn’t have
much success in previous years. MI also questioned other types of affordable
housing types which have been tried.
PW noted that within a package deal there can be no certainty of a grant with DC
noting grant levels within the Vale have historically been low. VB also noted that
WAG frequently review affordable housing grant provisions. JH commented that
assuming all affordable housing is provided by RSLs this is not the case as it can be
dealt with through 106 provisions.
Vale of Glamorgan – Final Viability Report 2010 Page 43
Different affordable housing delivery approaches were then discussed. VB noted
RSLs operate differently in England where they bid against each other for sites with
no geographical boundaries. Where as in Wales there are zones limiting their
activities. However, the partnership approach promoted by WAG can make grants go
further as RSLs are not bidding against each other.
It was noted that all sites up until now have had grant bench marking.
Comments please to
Andrew Golland drajg@btopenworld.com
Key data assumptions
Market areas and prices:
The development mixes were as follows:
• 30 dph: including 10% 3 bed terraces; 10% 3 bed semis; 10% 4 bed semis; 20%
3 bed detached; 30% 4 bed detached; 20% 5 bed detached.
• 40 dph: including 5% 1 bed flats; 10% 2 bed flats; 20% 2 bed terraces; 20% 3
bed terraces; 5% 4 bed terraces; 10% 3 bed semis; 10% 4 bed semis; 10% 3 bed
detached; 10% 4 bed detached.
Vale of Glamorgan – Final Viability Report 2010 Page 44
• 50 dph: including 15% 1 bed flats; 20% 2 bed flats; 25% 2 bed terraces; 30% 3
bed terraces; 5% 3 bed semis; 5% 4 bed semis.
• 75 dph: including 5% studio flats; 25% 1 bed flats; 40% 2 bed flats; 5% 1 bed
terraces; 15% 2 bed terraces; 10% 3 bed terraces.
Affordable housing targets:
10%;
15%
20%;
25%;
30%;
35%;
40%;
Affordable housing split: 65% to 35% Social Rent to Shared Ownership
Development costs
Based on RICS BCIS database:
Costs as set out below:
Vale of Glamorgan – Final Viability Report 2010 Page 45
Appendix 3 Results – Residual values in £s million per hectare (no grant)
30 Dph
0% 10% 15% 20% 25% 30% 35% 40%
Rural (incl Cowbridge) £5.10 £4.58 £4.32 £4.06 £3.80 £3.54 £3.28 £3.07
East Vale £4.66 £4.17 £3.92 £3.68 £3.44 £3.19 £2.95 £2.70
Penarth & Dinas
Powys £3.93 £3.49 £3.28 £3.06 £2.85 £2.62 £2.41 £2.19
Rural South & Coast £2.25 £1.94 £1.78 £1.63 £1.47 £1.32 £1.16 £1.01
Barry West £2.14 £1.84 £1.69 £1.54 £1.38 £1.27 £1.08 £0.93
Barry East £1.20 £0.97 £0.85 £0.73 £0.62 £0.50 £0.38 £0.27
40 Dph
0% 10% 15% 20% 25% 30% 35% 40%
Rural (incl Cowbridge) £4.32 £3.82 £3.57 £3.32 £3.07 £2.90 £2.56 £2.31
East Vale £3.94 £3.47 £3.23 £3.00 £2.76 £2.52 £2.29 £2.05
Penarth & Dinas
Powys £3.40 £2.96 £2.75 £2.53 £2.31 £2.10 £1.88 £1.66
Rural South & Coast £1.74 £1.43 £1.27 £1.12 £0.96 £0.81 £0.65 £0.50
Barry West £1.60 £1.30 £1.15 £0.99 £0.85 £0.70 £0.54 £0.40
- -
Barry East £0.79 £0.55 £0.43 £0.31 £0.19 £0.07 £0.05 £0.17
50 Dph
0% 10% 15% 20% 25% 30% 35% 40%
Rural (incl Cowbridge) £3.89 £3.38 £3.12 £2.85 £2.60 £2.34 £2.08 £1.82
East Vale £3.57 £3.07 £2.83 £2.58 £2.33 £2.08 £1.84 £1.59
Penarth & Dinas
Powys £3.14 £2.67 £2.44 £2.21 £1.98 £1.75 £1.52 £1.28
Rural South & Coast £1.39 £1.06 £0.89 £0.72 £0.56 £0.39 £0.22 £0.05
-
Barry West £1.21 £0.89 £0.73 £0.57 £0.41 £0.25 £0.09 £0.07
- - - - -
Barry East £0.46 £0.19 £0.06 £0.02 £0.23 £0.55 £0.97 £1.48
75 Dph
0% 10% 15% 20% 25% 30% 35% 40%
Rural (incl Cowbridge) £4.01 £3.39 £3.07 £2.76 £2.44 £2.12 £1.81 £1.49
East Vale £3.68 £3.07 £2.77 £2.47 £2.17 £1.86 £1.56 £1.26
Penarth & Dinas
Powys £3.26 £2.69 £2.40 £2.11 £1.82 £1.54 £1.25 £0.96
- - -
Rural South & Coast £0.98 £0.57 £0.37 £0.17 £0.11 £0.24 £0.44 £0.64
- - - - -
Barry West £0.71 £0.32 £0.13 £0.06 £0.26 £0.45 £0.64 £0.84
- - - - - -
Barry East -£0.22 -£0.54 £0.70 £0.86 £1.02 £1.18 £1.33 £1.49
Vale of Glamorgan – Final Viability Report 2010 Page 46
Worked Example – 50 dph scheme at 25% Affordable Housing in the West
Barry sub market
Vale of Glamorgan – Final Viability Report 2010 Page 47
Vale of Glamorgan – Final Viability Report 2010 Page 48
Vale of Glamorgan – Final Viability Report 2010 Page 49
Vale of Glamorgan – Final Viability Report 2010 Page 50
Vale of Glamorgan – Final Viability Report 2010 Page 51
Vale of Glamorgan – Final Viability Report 2010 Page 52