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£Multi-billion affordable housing scheme launched

£Multi-billion affordable housing scheme launched

Category: Mortgages

Updated: 28/01/2014
First Published: 28/01/2014

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

A multi-billion pound housing programme that could result in 165,000 new affordable homes being built between 2015 and 2018 was officially launched yesterday, delivering a welcome boost to the housing sector.

The Government has committed £2.9bn to the scheme while the remaining £20bn is set to come from the private sector, with housing associations, house builders and councils now able to bid for Government funding – £1.7bn of which is available for projects outside London. However, the funds are only available to affordable rent (where rent is 80% of the market rate) and shared ownership schemes, with the programme dictating that any bid needs to focus on building new homes that are in short supply in the local area.

Housing minister Kris Hopkins says of the launch: "House building is an essential part of this Government's long-term economic plan. That's why we have designed an ambitious new scheme to build affordable homes at the fastest rate for 20 years. Our programme will support 165,000 jobs in construction, sustain thousands of small businesses and provide homes where future generations can live and raise their own families."

He added that UK house building was at its highest level since 2007 while construction orders are increasing at their fastest rate for 10 years, although the current rate of house building (135,000 new homes were built in the year 2012-13) is still a long way from the 250,000 homes that experts suggest are needed each year to meet demand and help ease the issue of rising house prices.

Nonetheless, it's a positive move for the industry and could give more people access to affordable homes over the next few years – and potentially help them get on the housing ladder with the likes of shared ownership.

The new initiative has been designed to build on the success of the current affordable housing programme, which is on track to deliver some 170,000 homes by 2015. In combination with the new scheme, this means 335,000 new affordable homes will be delivered between 2011 and 2018.

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