With new initiatives and a big financial commitment the government has set a clear agenda on housing. The Housing Forum’s Shelagh Grant unpicks the key proposals.
Shelagh Grant
At the end of the political conference season we now know where the parties stand on housing. Labour has firmly nailed its colours to the mast of public sector intervention with a proposal for a massive increase in council house building, which echoes of the glory days of the post-war house building era. Many will agree that local authorities should be given the resources they need to deliver more homes appropriate for their areas.
Meanwhile, at its conference in Birmingham the Conservative Party confirmed its commitment to keep housing centre stage with announcements that suggest a markedly different approach from the previous government and new funds to support it.
The Home Building Fund has been announced after months of trailing the idea of a single funding pot. It is an amalgamation of funds totalling £3bn, comprising £1.15bn of new long- and short-term loans, £525m Builders Finance Fund, the £1bn Large Sites Infrastructure Programme and Build to Rent. £1bn of the fund has been earmarked for small and custom builders to generate 25,500 new homes and the balance will provide long-term funding for infrastructure.
Increased funding
The good news is an increase in quantum of funding and the inherent simplicity for the Homes and Communities Agency to administer it. We’re keen to hear further details of what will be delivered in terms of housing tenures, particularly sub-market rent or intermediate products and how the Starter Homes policy will feature in the new programme.
The £2bn Accelerated Construction Fund, an ambitious programme to build on public sector brownfield land, was also launched. A rebrand of the previous government’s Direct Commissioning initiative, it is intending to use land differently, such as derisking sites by early investment in infrastructure and receiving equity from developers after the sale of homes instead of an upfront payment.
The fund will be specifically aimed at smaller builders, custom builders and offsite manufacturers to stimulate the much-needed diversity of supply in the market.
The proposal is to deliver up to 15,000 homes on surplus public sector land by 2020. To deliver on this, a concerted cross departmental effort will be required to deliver sufficient consented land to the market in the timescale.
“We should be pleased that increasing housing supply remains at the centre of national policy for both political parties and that we are seeing a return to pragmatism rather than ideology from the current government.”
A new White Paper that cements the government’s commitment to increase and speed up housing supply is expected later this year. The detail is scant, but expect to see more emphasis on small sites, more efficient use of land and increases in density.
There is likely to be further steamlining of the planning system, claimed by some commentators as the cause of constrained supply (the reality is that planning approvals have sped up and a better way of resolving “sticky” planning processes is to better resource planning departments).
The housing minister has made some encouraging announcements about improving quality as well to sustain community support for new homes.
Devolution appears to remain a priority for the government so that combined authorities and new mayors take full control of local housing supply and infrastructure investment, enabling cities like London, Birmingham and Manchester to decide their priorities rather than have them dictated by inflexible national requirements.
One of the most reassuring statements from the housing minister is the recognition that each area has a different housing needs, whether an increase in sub-market and intermediate rent or an increase in home ownership. This is particularly the case in many forgotten areas of the country which have fared badly and are yet to recover. In those cases an “industrial strategy” to generate employment and opportunity is needed to sit alongside a tailored approach to addressing affordable housing needs.
So we should be pleased that increasing housing supply remains at the centre of national policy for both political parties and that we are seeing a return to pragmatism rather than ideology from the current government. There is undoubtedly a need to increase home ownership, yet it is imperative that we address the needs of a wide group of society through a mixed-tenure solution.
The private rented sector must be improved and regulated, a wide band of housing types and tenures is required in different areas, and young and old must be better provided for in the context of significant demographic change.
We hope the government is not only listening but will provide further detail of recent announcements in the Autumn Statement.
Shelagh Grant is chief executive of The Housing Forum
