Online guidance to help local authorities and developers establish the economic viability of housing and mixed-use regeneration schemes has been updated and re-issued today, by the Homes and Communities Agency (HCA).

The Economic Appraisal Tool (EAT) allows local authorities to establish effective but realistic affordable housing targets in order to meet national planning policy requirements, based on a calculation of residual land value. The tool is designed to be site specific, but can also be used to inform viability modelling to test affordable housing targets in Local Development Frameworks.


The HCA encourages bids for grant funding to be accompanied by an EAT submission, which it then uses to help determine grant levels, as well as demonstrate the added value social housing grant can bring to a scheme. Local authorities are able to estimate a saleable value for land as well as negotiate s106 and other planning obligation agreements; and developers can use the EAT to estimate how much they should pay for land as well as to inform their own s106 negotiations.

Richard Hill, Director of Investment and Renewal at the HCA, said: "This is a really useful planning tool which we’re re-launching at a time when the economic viability of schemes has been brought more sharply into focus because of current market conditions.

"It's online and easy to use and complements our guidance on negotiating s106 agreements in the downturn, where we made it clear that at the HCA we consider partnership working and upfront planning to be the early keys to successful delivery.

"Every partner needs to know what the other can bring to a development opportunity, and crucially, what they intend to take away. Our EAT will help in that transparent process."

(CD/BMcC)