Government announces £5bn housebuilding fund

Sajid Javid, Secretary of State for Communities and Local Government, has today announced a new package of measures to increase housebuilding, including a £3 billion Home Builders’ Fund and £2 billion of new investment for accelerated construction on public land.

Related topics:  Finance News
Rozi Jones
3rd October 2016
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"Years of missed recommended housing targets since the Barker Review have led to a housing shortfall of over a million properties, and the proportion of houses built by SME developers has steadily fallen since the 1990s"

Javid said the Home Builders Fund will enable SMEs, custom builders and developers to deliver more than 225,000 new homes.

The government will also pilot accelerated construction on public land, taking government-owned land and partnering with contractors and investors to speed up housebuilding.

Javid said the measures will "allow us to get started on 15,000 homes by 2020".  

The government will also bring forward a package of measures to encourage urban regeneration and to build on brownfield land "to radically increase brownfield development and bring life back to abandoned sites".

Charles Haresnape, Aldermore’s Group Managing Director, Mortgages, said: “Aldermore welcomes the announcements from the Treasury supporting increased levels of housebuilding, but far more needs to be done for the UK to tackle supply issues, as this additional funding is not enough to match demand. Aldermore has long made clear its commitment to smaller developers and the vital role they have to play in solving the housing supply deficit.

"Years of missed recommended housing targets since the Barker Review have led to a housing shortfall of over a million properties, and the proportion of houses built by SME developers has steadily fallen since the 1990s. The Chancellor’s renewed commitment to the loan fund for small house builders will provide welcome certainty to those looking to embark on new projects."

Andrew McPhillips, Chief Economist at Yorkshire Building Society, added: “Insufficient levels of house building over the years have driven up house prices, making homes unaffordable for many so it is vital the government addresses this issue.

“Speeding up the house building process by providing funding for smaller house builders and making more brownfield land available to developers will go some way towards tackling the 1.2m housing deficit the UK has accumulated by missing house building targets since 2004.

“That said, it is crucial that the Government strikes a balance in the type of homes being built. The Government is right to support those looking to buy their own property but the needs of those wishing to rent at affordable prices should not be entirely overlooked either.”

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