It has long been a belief of mine that any approved development must have the Section 106 provision meet the Social Housing Market Assessment (SHMA). In Havering, our SHMA shows that we have an urgent need for three or four-bed family homes. Unfortunately, building these types of homes is just not viable for many developers, but it could be done in-house.
Councils do not have to deliver the same ROI as a private developer and they can afford to take longer to get a return on their investment. With private developers focusing on the one and two-bed properties, bringing MLH in-house would allow it to focus on larger family homes. Not only would this help meet our housing need, it would also mean a better quality of life for hundreds of families across the borough.
Reporting to the scrutiny committee that I chair, Havering said it had 509 families in temporary accommodation as of November 2024. The proposed plan to resolve this includes an £18m spend on buying homes from the market and a further £25m in office-to-residential conversions.
“Bringing MLH in-house would allow it to focus on larger family homes. Not only would this help meet our housing need, it would also mean a better quality of life for hundreds of families across the borough”
Families with support needs and complex lives being crammed into permitted development office conversions doesn’t fill me with much joy. Nor do I think it is what we need, especially as one of these proposals involves moving around 50 families out of the borough completely.
It is clear to me that bringing development in-house would allow for better-quality housing.
Havering is going bankrupt. We have an £80m budget deficit and millions of that is due to temporary accommodation costs. Havering Council spends £7m on paying private landlords and nearly £6m a year on hotels and nightly accommodation.
This shows a potential for a £13m spend reduction, as well as new revenue from rents.
While MLH may have been a good idea during happier times, the £1m profit is an insignificant income. MLH doesn’t meet our housing need, it doesn’t provide value for money, and it is inflating the cost of construction.
Companies like MLH exist across the UK, not just in Havering. With many local authorities facing financial collapse, it is time for local councils to bring these developers in-house. This will drive down costs and allow for the construction of what we actually need.
David Taylor, Places Committee chair, London Borough of Havering
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