The Cabinet will use the same criteria as was used for other estates in the programme unless there are good reasons not to.
Firstly, all options must achieve these criteria:
- Viability: option achieves a positive Net Present Value (NPV);
- Deliverable: that delivery risk is manageable and that phasing and construction programmes are feasible (as far as can be ascertained at the moment);
- Meets Key Guarantees: delivers the re-provision of existing homes in line with the Key Guarantees to residents;
- Meets Planning Policy and Tenancy Strategy: option meets, as a minimum, Council planning policy and Council tenancy strategy on affordable housing for the construction of net additional new homes;
Further criteria to be considered include:
- Favouring options where the quantity of new homes provided is higher;
- Favouring options where the quantity of new homes for council rent is higher;
- Optimal Tenure Split: aim to achieve a tenure split between market and affordable homes, which is closest to a 60% affordable/40% market split (taking into account any localised reasons for moving away from this split);
- Nature of market housing: preference for private rent;
- Pay-back period: favouring options that provide shorter pay-back periods, while acknowledging that the Council is able to invest in the local community over a far longer period than a private developer, to support the needs of local families;
- Subsidy: favouring options that require the least subsidy to meet the other criteria listed above.
 Net Present Value (NPV): This is the difference between the present value of cash inflows (income) and the present value of cash outflows (costs). NPV is used in capital budgeting to analyze the profitability of a projected investment or project.
 Pay-back period: This is the time required for the amount invested in an asset to be repaid by the net cash outflow generated by the asset. It is a simple way to evaluate the risk associated with a proposed project. The pay back period is expressed in years and fractions of years.
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