In a bid to tackle the chronic shortage in housing, the Chancellor has announced a new £2.3 billion Housing Infrastructure Fund. This will deliver up to 100,000 new homes in areas of high demand and a further £1.4 billion to build 40,000 additional affordable homes. Another £1.7 billion by 2020-21 will be used to speed up the construction of new homes on public sector land.
Philip Hammond also announced the relaxation of restrictions on government grants to allow providers to deliver a wider range of housing types.
Mr Hammond said: “The challenge of delivering the housing we desperately need is not a new one, but the effect on our nation’s productivity makes it an urgent one.”
Mark Hayward, managing director, National Association of Estate Agents says: “We welcome the £1.4 billion funding injection for house building, while a relaxation of how existing affordable housing funding can be used will help to diversify our housing mix, creating the homes that people want and need.
“However, the creation of 40,000 new homes that this new funding is expected to deliver is still painfully short of the number of affordable homes we need to solve the housing crisis and get first-time buyers on the housing ladder.
“We hope that the government will announce an intent to do much more when it releases a widely expected White Paper at the Autumn Statement. It is vital that the government uses this to signal a radical rethink in its housing strategy and consider measures such as building homes on unused Green Belt land to really kick-start the house building boom we badly need.”
Stephen Smith, director, Legal & General Housing Partnerships, adds: “The Chancellor’s pledge to add another £1.4 billion into the housing market is desperately needed and will be welcomed by both the industry and hopeful first-time buyers across the nation.
“This decision is a welcome first step in rebuilding the fragmented sector. However, this act alone will not solve our housing crisis. The additional funding will hopefully go some way towards helping the government achieve its build target of one million affordable homes by 2020 and will encourage a collaborative effort from the government and house-building associations.”
Right to buy pilot
The Chancellor also announced a large-scale regional pilot to give the Right to Buy for housing association tenants, as well as continued support for homeownership through the Help to Buy: Equity Loan scheme and the Help to Buy Isa. More than 3,000 tenants will be able to buy their own home with Right to Buy discounts under the pilot.