Woking council to spend up to £300m on stalled sites

Surrey councils are preparing to spend hundreds of millions of pounds purchasing stalled residential building sites for social housing.

In what is thought to be the first project of its kind, Woking council will vote in December on raising up to £300m to unblock stalled developments.

The council has already committed itself to spending £30m over the next six years on buying up private properties as part of its social housing investment programme. The further funding could be borrowed from the public works loans board, the government agency that funds capital projects.

Ray Morgan, Woking’s chief executive, who initiated the scheme, said: “Perhaps we can help bring forward sites that are stalled or nearing completion but at risk of non-sale through lack of mortgage availability.”

A council spokesperson added: “All councils in Surrey are now taking part in the talks.”

Morgan said further details would emerge in the new year. He said: “We are just establishing the base position and options.”

Woking has a severe social housing shortage with about 3,000 people on the housing register and just 12 houses available. “Decent and affordable housing is priority number one,” said the spokesperson.

However, homes provided by unblocking schemes will not meet level three of the Code for Sustainable Homes, required of affordable homes funded by the Housing Corporation since April. Morgan said the homes would not have to meet the standard as they would not be funded by the corporation.

Other authorities are considering similar arrangements. Building understands that Newcastle council has already been approached by a developer to revive mothballed building sites and that negotiations are at an early stage.

In August, Newcastle council bought 15 completed private homes for affordable housing. Earlier this month, nearby County Durham spent £18m buying up new build and existing properties and renting them out with an option to purchase.