Property developers have been granted an affordable housing get-out clause by the government that could see the number of reasonably priced flats being built in Southwark slashed by half to just 300 a year.
Since December, anyone who converts an empty building into private housing has been exempted from paying for further affordable units.
Normally they would have to build a corresponding number of affordable homes or pay a lump-sum to the council in lieu.
The so-called ‘vacant building credit’ was aimed at providing a clear incentive for brownfield regeneration, whilst protecting the Green Belt. But it also heralds huge profit increases for developers.
Officials at Southwark Council this week estimated the change could set the borough back around £90million a year or, more importantly, mean developers have to build around 300 fewer affordable homes every year.
Southwark’s cabinet member for regeneration Cllr Mark Williams said: “If we have any hope of solving the housing crisis we need many more homes of every kind. This new policy will make that much more difficult.
“The government clearly hasn’t thought this through or given any consideration for how it will affect different parts of the country, and it is ordinary people who will suffer as a result.”
Housing Minister Brandon Lewis defended the measure, saying it was part of a package of measures by the government designed to reduce the number of empty buildings across the country.
“It was crazy to be levying a tax on empty and redundant buildings being brought into productive use,” he said.
“Such stealth taxes hindered regeneration and encouraged more empty properties.
“Our changes will help deliver more housing at no cost to the taxpayer in both London and across England.”