Reforms to Housing Revenue Account could unlock 88,000 new council homes, districts say
Raising the threshold at which councils must set up a separate financial management account for their council housing, known as the Housing Revenue Account (HRA), could unlock up to 88,000 additional council homes, the District Councils' Network has said.
In a report on how to build more homes in England titled 'A blueprint to tackle the affordable housing crisis', the DCN said changing the HRA threshold from 199 to 999 homes "would free smaller councils from bureaucratic, complex accounting requirements".
It also said an extra 8,300 affordable homes could be built annually in rural areas by closing planning loopholes that allow developers to side-step commitments to include affordable housing in new developments.
A further 8,800 properties could be brought back into use if the Government gave councils stronger powers to tackle empty homes, according to the report.
Other recommendations included introducing a 'Right to Pause' mechanism allowing councils to temporarily suspend council house sales in areas where social housing waiting lists are high; a call to make it easier for councils to set up housing companies; and changes to permitted development rights.
On permitted development, the report said the Government should end the "legal exceptions that allow buildings to be converted into homes without typical planning restrictions" in order to stop developers from avoiding providing affordable housing.
It also said there should be nationally standardised Section 106 templates to eliminate variability and reduce legal costs.
Cllr Hannah Dalton, Housing Spokesperson for the District Councils' Network, said: "District councils want to tackle the affordable housing crisis head-on.
"We have the local knowledge, the relationships, and the drive to deliver, but what we need now are the powers and resources to get the job done. The fact that just three changes could deliver over 100,000 homes demonstrates the scale of what's possible.
"The current Government requirement to set up a complicated and expensive bureaucracy if a council has more than 200 homes thwarts many from building new council homes. If the threshold to set up a Housing Revenue Account was raised to 1,000 homes, the potential exists to build 88,000 new homes.
"We need the teeth to force developers to honour commitments to include affordable homes in developments and the ability to take on empty homes."
Adam Carey
