Cambridge: Why were city flats built with no affordable homes?

At least a fifth of 3&4 Station Square is owned by overseas buyers

A £40m project to build flats in the heart of the university city of Cambridge was supposed to provide "much-needed local housing". But the development was not required to include affordable homes and now BBC research has found at least a fifth have been sold abroad. Why?

The apartments at 3&4 Station Square overlook Cambridge station, offering residents swift access to the city's rail links and historic centre.

But standing in front of the two blocks, Frank Gawthrop, secretary of a local residents' association, says what happened is "absolutely reprehensible".

A city councillor believes they are an example of how the city's property market is "driving and reinforcing inequality".

At least a fifth of the 89 flats were sold to overseas buyers. Some apartments have appeared on short-term rental websites.

A local planning policy aims for new estates to be 40% "affordable", yet the £40m development was allowed to go ahead without any affordable homes.

The developer says it did not break any rules or guidelines and that international purchasers paid prices in line with UK buyers.

Sam Davies, an independent Cambridge City councillor, believes Cambridge's property market is a "safe-haven for global capital"

Sam Davies, an independent city councillor, says it is "absolutely incredible" that "prime property in this location" did not generate enough profit for developers to provide affordable housing.

"Property is built and bought here not as a way of addressing local need - which is of course the justification which is always provided - it is a global investment vehicle," she says, "and that has a hugely distorting effect on the pricing and availability of property here."

Some real estate analysts argue, however, that expensive construction projects may not go ahead without international buyers providing finance.

Essex-based Weston Homes built 3&4 Station Square in Cambridge

In 2019, Bob Weston, the chairman and chief executive of Essex-based developer Weston Homes, which built and sold the flats, said they would "help to provide much-needed local housing".

When planning permission was granted in 2017, a report on behalf of the landowner - Brookgate - argued that if the development had to provide any affordable homes, it would not be "viable".

Cambridge City Council's policy is 40% of new developments should be "affordable homes", meaning if they were let out, rents would be no more than than 60% of the city average.

The council's planning committee approved the scheme with no need for affordable homes.

Weston Homes says it was "not involved in obtaining planning" for 3&4 Station Square, while the city council says its planning process "was consistent with approved planning practice and national planning policy requirements".

'Sleepless nights'

Duncan Dennis says some high-demand rental properties in Cambridge can get taken within 48 hours

Duncan Dennis, 32, says finding a flat to rent in Cambridge is "probably the hardest thing I've done in my life".

He and his girlfriend decided to move in together, prompting an "exasperating" and "utterly exhausting" property search.

The former pub manager says they applied for 30 properties in five weeks but kept missing out. "High demand" properties would "disappear within 48 hours", he says.

"I thought running a pub through Covid was tough," he says.

"I had less stress doing that than I have had in the past six weeks trying to find a house.

"It's given me a few sleepless nights recently just because you do end up worrying about all the 'what ifs': what happens if we don't find a place? What happens if we get refused for it? What if they decide to change their mind and go for someone else? What are we going to do?"

Advertised and sold overseas

Within weeks of Weston Homes starting to advertise the one and two-bedroom apartments in February 2019, several were sold to buyers which, Land Registry documents show, were based in Hong Kong.

A design company says it produced brochures in English and Mandarin. An exhibition was organised at a five-star hotel in Hong Kong.

In an article about the development, an estate agent operating in Malaysia said Cambridge had "an incredibly robust property market" and property in the city offered "excellent capital appreciation and strong rental yields for property investors".

Land Registry documents show at least 17 of the 89 apartments at 3&4 Station Square were purchased by buyers who have addresses in Hong Kong or Singapore.

Another 10 appear to have been bought by property investment companies, who own the leases to five flats each.

Mr Gawthrop, secretary of the South Petersfield Residents Association, says the situation is "dreadful" and describes a "huge generational divide" in the city "caused by this sort of inward investment that is pushing up the prices beyond the reach of ordinary people".

"Local young people just don't get a look in," he says.

Cambridge has among the lowest rates of property ownership outside London. The proportion of households that own their homes fell from around 49% in 2011 to 45.8% in 2021.

Weston Homes says the properties were marketed "locally, nationally and internationally" and "international buyers did not pay a premium".

One international buyer paid £441,600 for an apartment, while another paid £387,500. A two-bedroom flat in the development has been advertised to rent for £3,200 a month.

The city council says it "has not seen evidence that the increase in property prices in the city is caused by foreign or overseas sales of a small number of properties (relative to the total housing stock in the city)".

But Mrs Davies believes some in the city are "beginning to question what they are getting out of the growth of the city".

'Priced out'

Graeme Hodgson moved 10 miles from Cambridge after being "priced out" of the city

Graeme Hodgson says he would have "absolutely stayed in Cambridge" but the 51-year-old found he and his family were priced out of the city where they had built a "network of relationships".

"It was a shame to move out," he says, but "it was a necessity".

Mr Hodgson, a father-of-four, bought a four-bedroom home 10 miles (16km) from Cambridge in Northstowe. He and his wife both have professional jobs but could not find a suitable home to buy in the city.

He says it needed "more truly affordable homes for local people" and that he fears his children would find it "almost impossible to find a place they could afford in Cambridge".

A spokesperson for Weston Homes says: "The lack of supply of rented accommodation across the country is well documented.

"The sale of properties to purchasers who intend to rent their property out, either from the UK or overseas, is a normal part of our sales strategy across our portfolio and is not contravening any rules or guidelines."

Brookgate, which owns the freehold to the land, says it "sold its interest to Weston Homes in 2018 who developed the buildings as its residential development partner and were responsible for all sales and marketing of the residential apartments".

Cambridge City Council says it employed "independent viability experts" to review Brookgate's planning application and the "valuation exercise partially reflected the high existing use value" of a commercial building that 3&4 Station Square replaced.

It adds: "Subsequent market conditions and costs may have changed, however, the process that the council followed was consistent with approved practice and national planning policy requirements that still apply to developments."

According to the council the wider redevelopment of land near the station has seen 325 new homes built, 121 of which are affordable.

You can see more on this story on Politics East on BBC One on Sunday, 11 June at 10:00 BST, with it also available on BBC iPlayer afterwards.

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