New money for affordable homes released

// HA News

Communities Secretary Sajid Javid has today (5 January 2017) unlocked £7 billion in a dramatic expansion of the government’s affordable housing programme to meet the diverse housing needs of the country.

Housing providers can now apply for a share of the fund, which was allocated an additional £1.4 billion at the Autumn Statement to deliver 40,000 new affordable housing starts across the country.

Alongside this extra funding, the government is expanding the existing affordable homes programme to offer a wider range of ways of helping people into home ownership and to provide support for those that need affordable housing.

By expanding the variety of tenures available, which now includes Affordable Rent, Shared Ownership and Rent to Buy, the programme will help meet the housing needs of a wider range of people in different circumstances and at different stages of their lives.

This includes homes for Rent to Buy which will be let with rents set at or below 80% of the local market rent for a set time period, giving tenants the opportunity to save for a deposit and then the option to buy their current home.

Communities Secretary Sajid Javid said “This government is committed to increasing housing supply and halting the decline in affordability.

“Our newly expanded affordable housing programme, turbo-charged by a multi-billion pound investment, will allow housing associations to build more homes in places where they are most needed, particularly for families who are just about managing.

“By encouraging the delivery of more homes under a variety of tenures, we can create a housing market which truly works for everyone, meeting the diverse housing needs of this country.”

Housing Minister Gavin Barwell added “Up and down the country we are investing more in affordable housing to help make the dream of home ownership a reality for thousands more tenants.”

“This includes opening up the housing market to younger people and providing decent, affordable homes for rent for those who cannot afford to buy.”

Homes and Communities Agency (HCA) Chairman Sir Ed Lister commented “The HCA is leading the government’s drive to increase the scale and pace of delivery of housebuilding. The expanded affordable housing programme will help us continue to work with both housing associations and developers new to this area of the housing market to increase the availability of affordable homes.”

The expanded programme will also allow providers the flexibility and agility to respond to local needs and markets. This will boost housebuilding by encouraging providers to deliver a mix of homes for both affordable rent and low-cost ownership that is most suited to each place.

More will also be announced in the housing white paper out later this month.

Shared Ownership and Affordable Homes Programme

Following the expansion and increased flexibility of the affordable homes programme, government investment will support the delivery of:

  • Shared Ownership homes, providing a route into home ownership for those struggling with affordability
  • Rent to Buy homes, helping first time buyers to save for a deposit to buy their home whilst they rent at discounted rates
  • more Affordable Rent homes, recognising that many of those who rent in the private rental sector need support to be able to afford market rents

These schemes are primarily focused on households with lower than average incomes and who tend to struggle to save. They will also benefit those families who are just about managing.

Rent to Buy has been introduced and expanded as part of the government’s Affordable Homes Programme 2016 to 2021, offering aspiring tenants on low to middle income a route to home ownership.

Housing providers who have successfully been allocated funding to the total of £1.28 billion for affordable housing were also named today. This is following the opening bidding round for the scheme in April. These allocations will enable providers to get on with building the affordable housing that is needed in England and will be a boost to overall supply.

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