Bids for Section 106 Homes Stalled

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Building

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What does the collapse in section 106 demand mean for housing delivery?

Summary

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69% Informative

Housing associations have stopped bidding to buy section 106 homes in many parts of the country.

This has resulted in a drop-off in affordable homes and major delays on for-sale schemes.

Only one of the 20 registered providers approached to take on the homes put in any bid at all.

Housing associations are struggling to find housing associations to bid on S106 deals.

Leeds Federated Housing Association pulled out of some bread and butter’s deals days before completion.

Since then, the association has put through just one new section 106 deal, for just six homes, and its development programme is now dominated by land-led schemes.

On projects of under 100 units, S106 starts were in 2023/24 just 13% of the level they were in 2020/21 .

Savills’ Turner says this is because smaller schemes result in higher management costs for associations.

Others point to longer-term concerns over the S106 system and say housebuilders have been slow to react to changing market.

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informal

Language

English

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Offensive language