Guide Unilateral undertakings, section 106 agreements, habitat mitigation and affordable housing contributions

7. Commuted sum calculator stages 2 & 3

Stage 2

Use the composite table below to work out what your affordable housing contribution is per unit  using the table below                                                               

Stage 3

Multiply this amount by the total number of units in your scheme (both market and affordable). This will be the commuted sum payable.

In some situations there will be a requirement for less than a whole dwelling on site. In these circumstances, a whole number of dwellings should be provided on site and a contribution for the remaining part unit should be paid as a commuted sum towards off-site affordable housing. To calculate the commuted sum, divide the part unit by 0.25 in an area where the 25% policy target applies, or 0.5 in an area where the 50% target applies, then multiply the answer by the amount shown in the relevant part of the above table.

Example 1. A development of 15 houses within the BuAB of Axminster would need to provide 3.75 affordable dwellings (25%). In this situation, 3 affordable dwellings would be required on-site and a commuted sum should be paid for the remaining 0.75. To calculate the sum required:

• Divide the part unit by 0.25 (because the development is in an area where the 25% policy target applies): 0.75 / 0.25 = 3.
• Then multiply the answer by the amount shown in the table: 3 x £11,559 = £34,677.

Example 2. A development of 15 houses within the BuAB of Budleigh Salterton would need to provide 7.5 affordable dwellings (50%). In this situation, 7 affordable dwellings would be required on-site and a commuted sum should be paid for the remaining 0.5. The sum required is:

• 0.5 / 0.5 = 1
• 1 x £46,496 = £46,496

Example 3. A development of 13 houses within the BuAB of Colyton would need to provide 6.5 affordable dwellings (50%). In this situation, 6 affordable dwellings would be required on-site and a commuted sum should be paid for the remaining 0.5. The sum required is:

• 0.5/0.5 = 1
• 1 x £28,958 = £28,958

Example 4. A development of 21 houses within the BuAB of Ottery St Mary would need to provide 5.25 affordable dwellings (25%). In this situation, 5 affordable dwellings would be required on-site and a commuted sum should be paid for the remaining 0.25. The sum required is:

• 0.25 / 0.25 = 1
• 1 x £13,634 = £13,634

Example 5. A development of 14 houses within the BuAB of Honiton would need to provide 3.5 affordable dwellings (25%). In this situation, 3 affordable dwellings would be required on-site and a commuted sum should be paid for the remaining 0.5. The sum required is:

• 0.5 / 0.25 = 2
• 2 x £13,634 = £27,268

Vacant building credit

If your scheme reuses vacant land or buildings, please contact us directly as your scheme may be eligible for a vacant building credit against the affordable housing requirements.

Affordable Housing Contributions and Viability

Where an applicant has concerns over the viability of a scheme and believes the scheme is unable to meet the policy requirements for affordable housing (be it as on-site provision or a commuted sum), they should discuss this with the planning team (providing the appropriate viability assessments) and consideration may be given to reducing the proportion of affordable housing required. Substitution of on-site provision with a financial contribution does not affect viability.

There are two important principles underlying the use of the calculator:

• First - the developer of a scheme should be no worse or better off financially, whether they provide the affordable housing on site or as a commuted sum.
• Second - the scheme being considered is viable for the % of affordable housing being tested. If this is not the case, the % of affordable housing sought should be adjusted BEFORE calculating the commuted sum to be paid.

If you have viability issues further information can be found in our Viability guidance.

For applications that require on-site provision of affordable housing or a contribution, this will need to be secured through a Section 106 Agreement that the Council signs up to.