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Craven District Council plans to build new homes for shared ownership

Craven District Council is working up plans to become a private developer.

The council plans on using its own assets to build homes for shared ownership and create an asset based income stream.

A pilot scheme to develop a site in Glusburn for three houses was approved by Policy Committee on November 3.

A programme to deliver a number of shared ownership properties to generate an annual income of £100,000 could then be developed if the pilot scheme is successful.

Paul Ellis, Director of Services at Craven District Council, said: "This project is a good example of the council being much more commercial in its thinking and using appropriate assets to support communities whilst at the same time developing income streams to help offset the massive financial challenges the council is facing."

The principle of shared ownership is that occupiers buy a share of the property, for example 50%, and then pay a rent on the remainder. The owners then have the option of acquiring additional shares with a consequent reduction in the rental payment.

The council pays the full cost of building the dwellings and recovers the cost by selling a share of the property with the additional prospect of a Homes and Communities Agency grant and commuted sums being made available to help subsidise the building costs.

In order to generate an annual revenue stream of £100,000 from shared ownership, the council would need to build approximately 50 dwellings. A realistic programme of developing three to five sites per annum for 10 - 15 dwellings per year over the four years to 2019/20 is being considered.

It is hoped construction work on the pilot scheme will commence in spring 2016.