Thousands of us are waiting for affordable homes. These skyscrapers have none

Something entirely normal happened last week: Five new skyscrapers were given planning permission in Manchester city centre.

They’ll bring in thousands of flats, a wave of amenities for residents like a dog spa, Mahjong room, and creators’ studio, and one could be the city’s tallest building, at 71-storeys. The five blocks — four of which are called Contour and climb to 47 or 51 storeys, with the tallest being Plot D — will be built next to Deansgate Square, already home to four steel-and-glass behemoths.

They all sit within the ‘Great Jackson Street Masterplan’ area, which the council has long designated as a skyscraper district. Renaker, the developer behind these towers, has included publicly-accessible amenities like retail and hospitality space, plus a public square, medical centre, and primary school.

On the other side of the Irwell, Henley Investments has drawn up plans to demolish the Regent Road retail park, and build 10 blocks of flats in its place. Six of these will be ‘towers’, comprising thousands more flats, with the tallest also set to be 71-storeys tall — and therefore vying for the title of the tallest building outside of London.

READ MORE: 'Embarrassing' estate on doorstep of a Manchester success story is getting some much-needed love

Manchester's rent trap

But both of these schemes have come in for sharp criticism. The Renaker scheme has permission to build 2,388 flats and Henley wants to build 3,300. Not a single home will be affordable, however.

Affordable housing, which the government says is a 'key element' of its plan to end the housing crisis, includes houses let at rents at least 20% below local market rents, properties let at rates set between market rents and social rents, and social housing.

Back in May, the M.E.N. reported that Manchester's waiting list for social housing was 17,000 strong. In Salford, 5,000 people are waiting for social housing.

Those figures go some way to showing the scale of demand for properties going at lower prices. However, developers are only compelled to include affordable homes in a development if they can make 20 per cent profit on the project.

In Manchester, it's thought developers often get nowhere near that threshold - with a source close to the planning process saying the typical average is ‘in the single digits’.

In the case of the Renaker and Henley developments, both developers say they have not achieved the 20 percent profit margin necessary to include affordable housing in their projects, as current planning rules dictate.

But both schemes have come to the fore just as a Manchester council report found the dominance of constructing luxury flats in the build-to-rent sector ‘can result in the perverse impact of new supply ostensibly adding to the inflationary pressures in parts of the city where new development has been most intense’. In other words, the premium skyscrapers, with little to no affordable housing, are driving up rents across Manchester for everyone.

'The dream of city centre living should be available to all'

In the face of these pressures, Manchester council leader Bev Craig has said national planning policies need to be more flexible to allow Manchester to deliver more affordable housing. She says the city is limited by a 'one size fits all' planning framework which doesn't take into account the difference between margins here and in London.

Meanwhile, other politicians on both sides of the cities’ boundaries have criticised the lack of affordable housing coming in these landmark schemes — with Salford MP Rebecca Long-Bailey saying change is needed so those who cannot afford the average city centre rent of £1,433 per month can achieve ‘the dream of living in our city centres’.

“With the need for more homes in our city, developers will be looking to continue to build year on year, which makes it so important that the dream of living in our city centres is available to all, and doesn’t become the preserve of only those on higher incomes,” she told the LDRS. “Building little to no affordable or social homes in large scale new developments will sadly make the latter a reality.

“In Salford alone we have over 5,000 people on the housing waiting list, and almost 1,000 children living in temporary accommodation… The housing crisis needs addressing urgently, and while Labour’s plan to build millions of homes will help [across the UK], vitally we need new developments to include a significant amount of social and affordable housing in their plans, as well as providing financial support to existing communities through investment in local public service infrastructure such as schools, GP surgeries and parks, as well as road, cycling and pavement improvements.”

And according to Jonathan Moore, a Lib Dem councillor in Salford, not building affordable homes in the city centres will ‘consign those who most need help and support to an uncertain and precarious future’.

“In too many developments in the city we see the council allow developers to wriggle out of mandatory affordable housing targets – the promise is always ‘jam tomorrow, never today’,” he went on. “This practice needs tightening up and entire developments of social and affordable housing brought forward that benefit the people of Salford.”

Marcus Johns, a Manchester Labour councillor representing the Deansgate ward, also objected to Renaker receiving planning permission for Plot D and Contour, saying that after already delivering public amenities like the aforementioned school and medical centre., he expects 'affordable housing would now be a focus - particularly in a development area with high sales values and strong commercial performance'.

“This is not enough and we need private developers to help”

The debate on the lack of affordable housing often can descend into a blame-game, with councils coming for the firing line for granting the planning permission in the first place. But Bev Craig, Manchester council leader, says her authority has limited tools to combat the phenomenon, within the confines of a national planning system that applies 'the same rules for London' to Manchester.

“We would like to see the national framework made more flexible to give us scope to deliver more affordable housing through the planning process and support the right development in the right places," she said.

“We already demand a lot from developers investing in our city. We expect high quality developments, with excellent public spaces, alongside other impactful contributions - and this is at a time when inflationary pressures in the construction sector remains high.

“This means major development in Manchester does come at a premium to investors - and it's not uncommon for developers to accept much lower profit rates here than expected through the national planning framework.”

Manchester’s target is to build 10,000 affordable homes, and 26,000 more market-rate properties, by 2032. The council wants 3,000 of those homes to be in the city centre.

It’s understood some 200 city centre affordable homes have been built since this target was adopted in 2022, another 700 are being built now, and a further 270 are in the planning process — which would make up two-fifths of the city centre’s designated proportion of the 10,000 affordable homes.

One measure councils have been able to use to support affordable housing is a 'Section 106 agreement' with a developer. They allow councils to mitigate the impact of development by getting the builder to pay for extra local services, facilities, infrastructure or environmental improvements that are needed due to the influx of new people, and can be used to negotiate how much affordable housing a development should include.

But Manchester council leader Bev Craig says Manchester needs a 'range of measures' to meet demand for affordable housing, and that she will be taking the issue to the top of the government — with Deputy Prime Minister Angela Rayner also heading up the housing brief.

"Although section 106 payments through the planning process are one route to support affordable housing, they have only ever accounted for a small proportion of affordable housing built here," Coun Craig said.

What would be much more impactful for Manchester people would be a range of measures including national funding to help meet demand and maximising opportunities on brownfield land.

"We will continue our conversations with the government to press for a long-term, properly-funded home building programme which delivers affordable housing in the numbers that our city and country needs."

In Salford, some 402 affordable properties were built last year. “This is not enough and we need private developers to help with this,” a Salford council spokesperson said.

The government’s plan

At the time of writing, Angela Rayner’s government department is consulting on major reforms to the planning system. Once they become law, the national framework will feature ‘golden rules’ which include ‘at least 50 percent affordable housing, with an appropriate proportion being social rent, subject to viability’ in projects ‘involving the provision of housing’.

The government line is that ‘it is necessary to allow the limited use of viability assessments’, which is where developers demonstrate their profit margins — and therefore show they can or cannot build affordable homes.

These will be used ‘where negotiation is genuinely needed for development to come forward, particularly in relation to affordable housing requirements’. But the government has ruled out using the assessments as ‘an excuse to inflate landowner or developer profits at the expense of the public good’.

It’s worth saying that the ‘golden rules’ only apply to green belt land. When the LDRS asked what the plan was for brownfield land, no response was forthcoming.

It therefore remains unclear how — or if — such golden rules will impact cities like Manchester and Salford, which don’t have a lot of green belt. It’s also unclear what the viability threshold will be under the new rules.

“It needs a multi-faceted approach”

While Bev Craig delivered a hint of what Manchester wants from the new government in a ‘properly-funded home building programme which delivers affordable housing’, her executive councillor for housing revealed a more specific desire.

“We are in discussion with the new government to do more with accelerator funding and brownfield land funding,” said Gavin White in an economic scrutiny meeting last week. He also pointed to a ‘strong pipeline’ of affordable housing coming in the next few years — as mentioned earlier.

But in the face of criticism that adding housing supply, albeit mainly luxury, to the housing market was pushing up price, he insisted the answer was to ‘get more houses built’ although, he recognised, ‘that will help but it won’t do it alone... It needs a multi-faceted approach’.

He did not say what the other aspects of such an approach should be. But he did tell the committee housebuilding takes time, so it might take a few years before affordable numbers dramatically climb, as he hopes.

That, in turn, means questions over who really benefits from city centre development will rage for a period.