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04/10/2017

Reaction to prime minister’s affordable housing cash boost

Words: Laura Edgar
New houses / iStock

Industry professionals have broadly welcomed £2 billion announced today (4 October) by Prime Minister Theresa May to go towards delivering more affordable housing, but this has to be just the start.

Government must commit to other solutions

Stephen Wilkinson MRTPI, president of the RTPI, welcomed the additional money, but cautioned that the government "must commit to other solutions for more investment to address the housing crisis".

"The RTPI has set out a number of solutions in our position paper Better Planning for Affordable Housing, including freeing up local authorities to invest in building affordable housing that includes social housing on secure tenure.  

"Further we are pleased that the government acknowledges that there is a need to better resource planning authorities to improve the speed of delivery of high quality affordable housing which the country needs. The RTPI with UCL is currently researching into how local authority planners can facilitate more investment in housing."

Infrastructure and housing should be considered together

Philip Atkins, vice-chairman of the County Councils Network (CCN) and leader of Staffordshire County Council, said: “County residents face the most unaffordable housing outside of London, with the average property price nine times the average yearly earnings, rising to 12 times higher in areas in the South East. Therefore, the premise of a renewed drive to build more affordable homes will be welcomed by many in counties.”

However, for Atkins, a narrow focus on simply council or housing association stock is likely to go only so far in solving the housing crisis.

He said the current planning system is fragmented in two-tier areas, with counties in charge of infrastructure and district councils tasked with delivering the homes.

“The two should be seen in tandem with each other rather than separate. The recently announced Statement of Common Ground is a step in the right direction, but doesn’t go far enough.

“The CCN has argued for a new role for county councils in strategic planning, working with district authorities and neighbouring unitaries to plan for homes over large, countywide areas. This will allow them to target development in the most appropriate areas rather than in places that generate local concern, while allowing for the necessary infrastructure to be built so communities do not feel extra pressure on their services.

“Without this role for counties, and meaningful planning reform, significantly increasing housing supply across all tenures could remain an aspiration rather than a reality.”

 

A shift in the housing vision?

Melanie Leech, chief executive of the British Property Federation, welcomed the extra £2 billion available for councils.

“We need a housing market firing on all cylinders, with the right signals from the government supporting all tenures. For example, council housing, home ownership and Build-to-Rent must all be supported if the government wants to effectively address the underlying issue of affordability.

“The government has called for family-friendly, longer tenancies in the private-rented sector, to ensure that renters have more security and the Build-to-Rent sector has responded by pledging its commitment to this. Our ambition is that longer tenancies become a trademark of Build-to-Rent.”

Lord Porter, chairman of the Local Government Association, said it is good that the government has accepted its argument that councils must be part of the solution to the housing shortage.

“We hope that today’s speech by the prime minister signals an important shift in the government’s housing vision and are pleased that there will be additional funding for affordable homes.”

Porter said a “genuine renaissance” in council housebuilding would increase housing supply, boost home ownership and reduce homelessness.

“Every housing market is different and the only way councils will be able to significantly deliver the new homes we need is if they are given genuine powers to invest in housing that meets the needs of communities in every town and city across the country.

“This means the ability to borrow to invest in new council housing, to keep 100 per cent of Right to Buy receipts to replace sold homes, certainty over future rents, powers to make sure developers build approved homes in a timely fashion, and adequately funded planning departments so that they can cover the cost of processing applications.”

 

Braver and bolder

Brian Berry, chief executive of the Federation of Master Builders, said: “Despite the prime minister’s precarious political position since the general election, Theresa May has today managed to take a braver and bolder stance on housebuilding than any prime minister of recent years.

He said the private sector would continue to increase the number of homes it builds, particularly if the government succeeds in its aim to remove barriers holding back small-scale housebuilders.

“The prime minister’s plan is also an opportunity to help shape a stronger local housebuilding industry. If councils can start to engage with smaller, local builders to deliver this new generation of council housing, it could further help to diversify the industry. This would also boost the capacity of the private sector through the provision of more public sector work. Indeed, the increased use of small and medium-sized building firms will limit the problem of land banking, as this is something small builders simply don’t do.”

Having said that, he added that there are still some significant roadblocks to the prime minister’s vision, including a shortage of skilled labour following Brexit.

 

Underwhelming

Adam Lent, director of think tank the New Local Government Network, said May’s £2 billion is “underwhelming”, with the scale of the crisis requiring “much deeper commitment”.

“The borrowing cap for local authorities needs to be lifted so that they can get on and invest in building new homes for social rent immediately. Instead, a new funding pot that councils and housing associations must bid for creates bureaucracy and will mean some areas win out over others. Today’s announcement was a missed opportunity to genuinely commit to a ‘rebirth’ of council housebuilding that our country really needs,” he added.

Polly Neate, CEO of Shelter, said: "We’re pleased to see the government acting to ease the misery of millions of private renters and tackling the desperate need for social homes at genuinely affordable rents.

“All new money is welcome, but the reality is that with over 1.2 million households on waiting lists already, this is only a fraction of the long-term investment required. It will need to be the start, rather than the end.

“We hope the government will be matching the size of their ambition to the sheer scale of the problem, with far more funding and the new powers for councils promised by the prime minister. Turning around our housing crisis for ordinary families will take a real commitment and a bold, long-term strategy."

 

Admirable aims but more than money required

Ian Anderson, CEO at Iceni Projects, said: "Fixing our broken housing market, building a million homes by 2020; the Prime Minister has admirable aims, but they won’t happen by themselves.”

He said the solution goes further than “throwing money at the problem” and £2 billion is “nowhere near enough” to deliver the housing that is needed.

"This is a national problem which requires everyone to play their part, none more so than local authorities and councillors. If this government is serious about delivery then we need to focus on ensuring that every local council has an up to date and realistic plan in place. Sadly, local plan preparation is continuing to slow, and if we don’t resolve this problem we will fail to deliver the right type of homes in the right places.”


Read more:

May commits £2bn extra to affordable housing 


Image credit | iStock

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