SELF BUILD COOPERATIVE SOCIETIES BASIC BUSINESS MODEL

COOPERATIVE SELF-BUILDS

A VISION FOR FUTURE INTEGRATED ECO COMMUNITIES, AFFORDABLE HOUSING WITH PASSIVE HEATING AND MACRO GENERATION

SOCIAL LANDLORD – (SIMPLIFIED) BASIC BUSINESS MODEL - 100 units on a 12 acre site

This is based upon buying previously undeveloped land in bulk (greenbelt), rather than as prime development plots of land, for which approach the policies cited above are supportive, if the council concerned has not identified and earmarked land for affordable housing. On the other hand, councils are encouraged to purchase land compulsorily for affordable housing. The financial model that follows is to build 100 homes which incorporate all of the 'RE' features as set out in Section 2. As a guestimate, £5 million pounds would ne needed to develop a 12 acre site, such that plots are a respectable size, together with typical village infrastructure.

COOPERATIVE (SELF BUILD) BASIC BUSINESS MODEL
.	.	.	.	.
YEAR	£ BORROWING	£ INTEREST 6%	£ PAYBACK	£ DRAW
.	.	.	.	.
1	5,000,000	300,000	300,000	200,000
2	4,700,000	282,000	318,000	200,000
3	4,382,000	262,920	337,080	200,000
4	4,044,920	242,696	357,304	200,000
5	3,687,616	221,257	378,743	200,000
6	3,308,873	198,533	401,467	200,000
7	2,907,406	174,445	425,555	200,000
8	2,481,851	148,912	451,088	200,000
9	2,030,763	121,846	478,154	200,000
10	1,552,609	93,157	506,843	200,000
11	1,045,766	62,746	537,254	200,000
12	508,512	30,511	508,512	260,977
13	Nil	Nil	Nil	800,000
.	.	.	.	.
Renting model for : 100 unit village – costs to build est @ = £5 million
.	.	.	.	.
Income on completion:		Rent x 50 units	@ £600 month = 360,000
.	.	Rent x 50 units	@ £250 month = 150,000
.	.		_____________________
			.£ 510,000

Equity stake of village: £10 million [not including feed in tariff macro-generation]

The above example is concerned to pay back borrowed money as a priority, taking a lesser drawing for property administration. Rents generated from 100 units is likely to be in the region of £400 - £500 a month depending on the mix of 1, 2 and 3 bedroom properties. So £4,800 - 6,000 per annum per unit, multiplied by 100 units = £480,000 - 600,000 - hence the ability to repay up to £300,000 in interest with £200,000 remaining for administration. After 12 years, the site is free of borrowings, when the real profit comes online - to be used for future developments, or shareholder dividends. Bearing in mind that our ethos is much the same as the old building societies. Commercial social landlords would appreciate the long term investment. Housing associations (self builds) would in effect repay their mortgages very much sooner, than with a conventional building society mortgage.

EASTBOURNE AFFORDABLE BUILDING SOCIETY

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