Central Government plan to make local government more and more dependent on financial incentives related to building houses and growing the economy, so they are cutting the general financing to achieve this.
For illustration purposes, a 3 bedroom detached property in the recently built Harvest Fields Estate, Sutton Coldfield would cost £250,000 (Band G £1,856.11 pa). The council, through developers Section 106 contribution could also receive an additional £350 pa in affordable homes bonus.
£1,856.11 pa [Council Tax exc. police and fire]
£350 pa [Affordable Homes Bonus]
£13,236.66 [New Homes Bonus, Per Property - 6 Year Period,]
10,000 Sutton Coldfield green belt houses, using our 3 bedroom house as an illustrative example, could deliver Birmingham City Council rewards of £1.32bn.
It is becoming clear that the lush green fields of what can only be categorised as ‘premium sites’ located in Sutton Coldfield, are a far more attractive proposition than the polluted brownfield areas of Birmingham or the Black Country, as suggested by the now defunct, but extremely valid West Midlands Regional Spatial Strategy.
Should the delayed Local Plan only wish to build 5,000 houses on the Sutton Coldfield green belt, which is slowly beginning to emerge, the Council’s new homes bonus could still bring rewards of £662m.
5,000 to 10,000 Sutton Coldfield green belt houses will be phased over 20 years, right?
When the Birmingham plan is examined, developers will argue, as they did at Lichfield, that there is a housing backlog which has to be caught up.
So if the Council plans to deliver 4,000 homes pa over the period 2008-2028 and the plan is adopted in 2014 with a shortage of say 10,000 homes actually built from 2008-2014, then the 'Sedgefield' approach forces Birmingham City Council to allocate land for the full 10,000 homes backlog on top of the normal allocation for the first five years (5 x 4,000 = 20,000).
The Council has to allocate sites for 30,000 homes in the first 5 years. The developers will dispute that many inner city sites are not viable in the current economic climate, but the Sutton Coldfield green belt site(s) are. This will result in the full 5,000 or 10,000 coming forward immediately for house building.
Once planning permission is granted the developer can build them as fast as they can sell them.
Birmingham City Council Council Tax Charges 2012/2013