Council wants to create company to build cheaper homes – starting in Caldicot

Monmouthshire Council hopes to set up its own building company to help address the shortage of affordable homes in the area.

And a new affordable housing development in Caldicot is being planned to test the idea.

The county council is progressing plans to establish a development company as it bids to take “an interventionist approach” in the local housing market and provide more lower cost homes.

Figures show growing disparity between house prices and income, with the average house price in Monmouthshire at £336,760 as of September, and average earnings for those living and working in the county at £29,640.

A council report says the need for affordable housing has become “particularly acute” due to an increase in homelessness referrals during the coronavirus pandemic.

A separate report last month showed 117 households in the county were staying in temporary housing, with a lack of affordable accommodation available.

Monmouthshire also has less terraced housing than the average in Wales and instead more detached homes.

The council has been working on plans to set up a wholly owned development company since April last year to address the issue by providing more affordable homes.

It is hoped the development company will have more control over the mix of housing on developments and be able to deliver affordable housing which may not otherwise be delivered by developers.

The council will also be able to control the way in which profits and receipts from land sales are invested into services, ensuring benefit for local residents.

Setting up the company is still in progress, with the council needing to first secure a land supply pipeline, but a pilot development to provide 14 affordable homes on a site next to Caldicot Comprehensive School is proposed.

A report says the pilot intervention would “signal intent” and provide opportunities to test the council’s development aspirations.

“The current market mechanisms are failing to meet demand and indigenous populations are increasingly being forced to re-locate as housing prices and rental levels become more and more unaffordable,” the report says.

“This proposal would enable the council to undertake a pilot development project, which would provide learning to support the planned creation of the development company, intended to speed up supply and meet design parameters that reflect the wider social justice agenda.”

The council’s cabinet will consider agreeing to the pilot project and to the continuation of planning for the development company at a meeting next Wednesday.