Chancellor Philip Hammond has today committed £3billion in extra borrowing to deliver 30,000 new affordable homes in England.
In the Spring Statement, the Chancellor announced that the Government will guarantee the extra borrowing by housing associations to support the delivery of the homes, but did not supply a timetable for delivery.
The Chancellor also announced that £717million from the £5.5billion Housing Infrastructure Fund will be used to help ‘unlock’ up to 37,000 homes at sites including Old Oak Common in London, the Oxford-Cambridge Arc and Cheshire.
L&G Mortgage Club director Kevin Roberts
Kevin Roberts, director, Legal & General Mortgage Club, said: ‘Getting onto and up the housing ladder remains an aspiration for many people across the country.
‘It’s great to see that the Chancellor has announced an additional funding.
‘However, if we are to keep the housing market moving, help is needed for those higher up the property ladder too.
‘We have already seen stamp duty scrapped for first-time buyers, but reviewing this tax for last-time buyers would assist older homeowners to downsize or move to a home more suitable for their circumstances.
‘This would help to free up housing stock, for example larger properties in school catchment areas for growing families.’
Will the Government’s target of 300k homes a year by 2020 be met?
The short answer is probably not – targets are far from being met whichever way you measure them.
In the 2016/17 financial year, 217,350 new build homes were completed, a long way off the Government’s target of 300,000 homes a year by 2020.
The most recently available figures from warranty provider NHBC, in Q3 last year, showed that 106,031 new build homes were completed by NHBC members by the third quarter, which represent around 80 per cent of the market.
Factoring an extra 20 per cent in would bring the total figure to around 132,500 for the calendar year, excluding conversions of non-residential properties.
Steve Wood, chief executive of the NHBC said: ‘300,000 is obviously a long way off and is a demanding target.
‘There is no silver bullet but there need to be some changes to the way the industry works to get there.’