[ad_1]
Haringey Council’s housing chief is “quite confident” of meeting the target even though higher construction and borrowing costs have made several schemes financially unviable.
The authority pledged to build 3,000 homes for council rent by 2031 after launching a major construction drive in 2018.
But inflation in the construction sector has since risen sharply and recent interest rate hikes have pushed up the cost of borrowing needed to fund the schemes.
Council reports say a “significant number” of projects that are not already in contract have been paused or delayed because they are not financially viable.
Despite the financial squeeze, the council says that on the “current trajectory” it will meet its target, with work “already completed or begun on 2,027 homes as of August 2023”. The reports add that 199 homes have already been finished and occupied.
Speaking at a meeting of the council’s housing, planning and development scrutiny panel on Wednesday, cabinet member for housebuilding Cllr Ruth Gordon said: “We feel quite confident that we can deliver the 3,000 homes. We have got more sites that are available than just for 3,000. It obviously does depend on the economic climate.”
Last year, the council switched 870 homes in its housebuilding programme from lower-cost formula rents to higher London Affordable Rent levels to ensure its plans remained affordable.
Council reports reveal that some of its construction contracts have been terminated after contractors went bankrupt, meaning new firms had to be appointed.
After panel members raised concerns over financial viability, Robbie Erbmann, the council’s assistant director for housing, said that even with the “fairly unusual” recent economic conditions “we are still pretty confident that the housing delivery is affordable”.
He added: “We are not making any plans to mothball any of our schemes on site. The HRA [housing revenue account]…
[ad_2]
