NEW YORK: A pilot project is evaluating a new approach to affordable house building where developers would attract a mix of private rental and general needs customers to a scheme to deliver an agreed total income.
Using this flexible model, in times when the housing market is overheated, the greater income from private rents can be used to cross subsidise social tenancies at a range of rent levels.
When the market is deflated, the affordability gap decreases requiring less cross-subsidy to support people in general needs. Rentals would only change at the start of new tenancies and the blend of private to social housing would flex according to the market.