KSPI 1 - Permanently affordable housing
The primary target community of this share offer is people in Taunton who are in need of more affordable homes. Through providing more affordable homes to rent and to buy, Somerset Co-operative CLT will serve people who currently find it difficult to buy or rent a decent, affordable home in the area. They will encourage people in housing need in the area to become members of SCCLT (people can become members of their community benefit society for £1) but they do not anticipate that many people who are currently in housing need will invest in their share offer.
SCCLT was formed principally to address a crisis in housing. In the Taunton Housing Market area, the need per 1,000 households (Fordham index) is 15.3, among the highest in Somerset. Since 2006 the number of households on the housing waiting list has risen from 2,211 to over 5,000 (source: Homefinder Somerset). Shelter describe private rented housing in Taunton Deane as 'fairly unaffordable', requiring more than a third of income (source: Shelter 2011).
Assuming a mortgage of 3.5 times income, the deposit needed by the median earner to buy an entry level 2 bed home (entry level 2 bed homes in Taunton cost £127,000) would be £50,000. 83% of residents of Taunton Deane have less than £50,000 savings (Taunton Deane Housing Need Survey 2010). Home ownership nationally is now at its lowest level for thirty years. SCCLT have found that supply of new social rental housing that is compact and affordable but has added collective benefits, is both a valuable service to provide to the community and a viable business model.
In 2015, the CLT set the rents at a level that would allow any adult reliant on housing benefit to afford a self-contained flat. The continued freezing of benefits since then, coupled with the reduced housig benefit offered to the under 35s, makes this a challenge.
Somerset Co-operative CLT can now say that rents are below housing benefit entitlements; and they are within reach of people with low entitlement (eg a younger person seeking a flat of their own) provided that they can use the £6 a week saved on broadband internet, the savings from use of the subsidised washing machine, and the £2 saved on reduced heating bills as a result of our investment in insulation, to make up any shortfall.