DEVELOPMENTS with as few as three new homes will have to contain housing for people on low incomes, under new Colchester Council policy.

The authority will ask developers hand over 35 per cent of properties to social landlords in a no-nonsense bid to cut its 6,000-name waiting list for council accommodation.

It will begin a public consultation into the plans tomorrow.

Paul Smith, St John’s Lib Dem councillor and a former accountant, said: “If we stick rigidly to the policy, it should eventually make land cheaper to buy, as companies will be negotiating on the assumption developments will definitely have to be 35 per cent affordable housing.”

The current affordable housing proportion is 25 per cent and projects with fewer than 25 homes are exempt.

It means developers can put up 24 houses and make more profit than if they built 26 or 27.

The council now proposes to introduce the 35 per cent rule for developments of three homes or more in villages and ten homes or more in the town.

Companies building less than three homes in villages will have to pay a charge which will go into an affordable housing fund.

Developers will lose out under the scheme as housing associations pay a reduced rate for the properties they take on, generally £50,000 less than the asking price.

Companies will be able to appeal to planners, for example if the development plot is a former industrial site which has cost a lot to clean up. Companies sometimes also seek to reduce the affordable housing quota by providing other community benefits, such as parks and play equipment.

The consultation document is available at Angel Court in High Street or Colchester Central Library from tomorrow and online at www.colchester.gov.uk