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Government and Barclays team up to provide development finance for housing

Words: Laura Edgar
Money / iStock-185267728

Barclays and the government have joined forces to provide £1 billion of development finance to help increase the pace and volume of housing provision across England, as the government looks to make good on its promise to deliver 300,000 homes a year by the mid-2020s.

John McFarlane, chairman of Barclays, said: “There is a vital need to build more good-quality homes across the country. This £1 billion fund is about helping to do exactly that by showing firms in the business of housebuilding that the right finance is available for projects that help meet this urgent need.”

Loans will be made available to developers and housebuilders that can demonstrate the necessary experience and track record to undertake and complete their proposed project.

The funding will range from £5 million to £100 million and will be open to new clients as well as existing Barclays clients. It aims to put a greater emphasis on diversifying the housing market, with a key priority for the Housing Delivery Fund to support small and medium-sized businesses.

Housing secretary James Brokenshire explained that the fund, which will see Homes England working with Barclays, “is a further important step” to building the homes the country needs “by giving smaller builders access to the finance they need to get housing developments off the ground”.

He added: “This is a fantastic opportunity to not only get more homes built, but also promote new and innovative approaches to construction and design that exist across the housing market.”

Chairman of Homes England Sir Ed Lister commented: “Homes England has been established to play a more active role in the housing market and do things differently to increase the pace, scale and quality of delivering new homes.

“The Housing Delivery Fund demonstrates Barclays’ commitment to the residential sector and will provide a new funding stream for SME developers to help progress sites and deliver more affordable homes across England.”

Barclays is providing £875 million towards the fund, while Homes England will contribute the remaining £125 million.

Image credit | iStock