Uni row brews on cheap homes levy (From Oxford Mail)

Uni row brews on cheap homes levy

1:00pm Friday 10th February 2012 in News By Reg Little

Colin Cook

UNIVERSITIES and developers face paying hefty contributions to help tackle Oxford’s housing shortage, as the price of getting approval for new student accommodation.

They will be forced to pay towards affordable housing in the city, with a new levy adding hundreds of thousands of pounds to the cost of major student schemes.

Oxford City Council said the existing planning rules make it financially advantageous for developers to build student units rather than desperately needed family homes.

An Oxford University source said the proposed levy would be a blow, at a time when it faces unprecedented pressure to take more students out of the private rental market.

One developer estimated that the levy would add £6,000 to the cost of each student room.

The city council said “ideally” it would have liked to see half the value of land being developed handed over, as a financial contribution from student accommodation developments.

But having examined the financial viability of nine development sites, it is proposing a levy of £140 per sq m.

Colin Cook, city council board member for development, said: “It is going to create a level playing field.”

Student accommodation schemes are not affected by current regulations which require at least half of any new housing development to be affordable homes.

Mr Cook said: “It means there has been an incentive to build student accommodation on sites that could have been used for building homes. This will remove that incentive.”

He said the council was particularly concerned about the growth of language school accommodation and speculative developments. He recognised that both universities would be hit, but added: “I believe that in the long term, the rents achieved from students will stack up for them financially. If it does not, we will be happy to look at their funding models and offer advice on how they can make it work.”

Student accommodation schemes that already have planning permission will not be affected.

Richard Gamlin, of Oxford-based Ardant which has planning permission for 166 student rooms on a former builders’ yard in Chapel Street, said the levy could add about £6,000 to the cost of each student room, making some schemes potentially unviable.

One university source said: “Clearly the provision of affordable housing is very important.

“But these plans would send a strange message at a time when the universities are simultaneously under pressure to take students off the open rental market by providing more accommodation.”

Oxford University spokesman Matt Pickles said: “We have made a response to the proposals and hope our comments will be taken on board.’ Oxford Brookes University declined to comment.