A company jointly-owned by Ikea could help deliver affordable homes for Worthing through a new and innovative approach.
The furniture retailer, in partnership with construction company Skanska, has already built more than 10,00 BoKlok homes throughout Sweden, Finland and Norway.
BoKlok is now looking to bring the model to the UK and one of its first sites could be Worthing Borough Council land off Fulbeck Avenue.
The company directly finances and manufactures the homes in a factory off-site.
The proposals in Worthing would see 162 flats built in blocks with 30 per cent provided for social and affordable housing to the council at cost in lieu of a capital receipt for the land.
The remaining 70 per cent would be provided based on BoKlok’s ‘left to live’ housing affordability model which aims to provide ‘genuinely affordable’ homes.
Using the average industrial salary for a full-time worker they first calculate what future residents can pay after tax and the monthly cost of living is deducted from their gross earnings.
As a rule of thumb, this is around 33 per cent of their net monthly earnings and this is converted to an ability to pay for a 25 year repayment mortgage.
For example, a combined household income of £53,000 for two key workers, after a left to live calculation, would give £1,200 a month to contribute to a mortgage, which roughly can afford a £250,000 25-year repayment mortgage at an interest rate of 4.2 per cent.
To ensure that these homes are delivered to those with most significant housing needs customers can only purchase one home to prevent sales to speculative investors.
All of the market sale homes are available to those who express an intention to purchase with BoKlok then using a fair ballot system to allocate the homes to successful customers.
There is a time restriction before the homes can be sold on.
According to officers: “A primary purpose of the proposal is to provide lower cost rental and sale homes for low income working households in Worthing.
“Our housing strategy highlights key themes including the availability of affordable family homes, in particular rented homes, and the economic impact of this lack of housing supply on our ability to retain lower income working households and employment in the town.”
According to BoKlok’s website: “Our homes are completed off-site in a safe and dry factory environment using a smart and industrialised process. Our costs are predictable and we are always working to get them lower.
“BoKlok has nothing to do with ‘flat-packs’; it is about high quality off-site manufacturing process that allows us to assemble them at quickly in a safe and sustainable environment, which we know that both employees and customers appreciate.”
The proposals are due to be discussed by cabinet members on Tuesday June 4.