Developer offers small bribe to avoid building affordable homes which would increase profits by millions

The development: 300 homes in beautiful Gittisham, home of the latest very posh and very popular “Pig at ..” hotel chain.

The bribe: £400,000

The catch: Allow Baker Homes to cut their “affordable” properties from 120 to 90.

So, for the likely cost of ONE of their new homes, let them build 29 more of them and see 30 families lose out on cheaper (but not cheap) homes.

Let’s say each new home cosy a very conservative £300,000 x in fact the average cost is likely to be MUCH more than that. Affordable homes would have cost £240,000 (a 20% discount).

120 homes sold at £240,000 = £28,800,000
180 homes sold at £300,000 = £54,000,000
Total income from sales: £88,800,000

or

90 homes sold at £240,000 = £21,600,000
210 homes sold at £300,000 = £63,000,000
Total sales = £74,600,000
Less £400,000 paid to council
Total income from sales = £74,200,000

Total increase in sales = £14,400,000

and all for an outlay of £400,000

If the houses DO cost even more the profit will be even higher.

So, what’s it to be Honiton? A bit of cash or 30 families done out of homes they MIGHT be able to afford – at a pinch?

One thought on “Developer offers small bribe to avoid building affordable homes which would increase profits by millions

  1. That is the best bit of political analysis on this site today by a long shot!!! Could even be the best bit of political analysis in East Devon ever.

    Though of course the size and cost of the affordable homes will also be lower, so profits are likely to be more than £14.4m.

    But isn’t it a great investment. £14.4m return from an investment of £400k or 3600% return on investment over (say) 3 years. That’s a fair bit better than the 1.5% over 3 years that us mere mortals get for our savings.

    As an alternative, how about Baker Homes giving EDDC (say) £14m to be allowed to provide less affordable homes, so with the lower costs they will make a reasonable return on investment and EDDC can use the £14m to build a tranche of social housing.

    Like

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