Chancellor George Osborne announces £7bn plans for new homes across Britain
Posted 25 November 2015 by Keith Osborne
In today’s Autumn Statement, Chancellor George Osborne has pledged nearly £7bn pounds to build 400,000 new homes across the country.
The Chancellor’s focus is on what the Treasury calls “the biggest affordable housebuilding programme since the 1970s”, doubling the housing budget and introducing new schemes to help younger would-be homeowners get on the property ladder through subsidised brand new properties. The nation’s housebuilders will be encouraged to participate, with the government acting as the “developer”, to achieve the ambitious building targets.
Osborne reiterated previously announced plans to build 200,000 new homes specifically for buyers under 40, which will be available at 20% below market value – a plan referred to as the Starter Home Initiative. This £2.3bn involves changing planning regulations to earmark certain brownfield sites exclusively for the construction of homes for first-time buyers, which will have a maximum value of £250,000 outside of London and £450,000 in London.
Proposals also include 8,000 new properties for older people and those with disabilities, and 135,000 more new homes available under a Shared Ownership scheme (called Help to Buy Shared Ownership), to be built over the next six years.
The Chancellor has gone some way to addressing one of the growing obstacles of the current Shared Ownership eligibility criteria by raising the household earning threshold to £80,000 per year, £90,000 in London.
Osborne also announced the launch of Help to Buy London, a version of the existing, popular Help to Buy scheme, where buyers in the capital will be able to get an interest-free equity loan of up to 40% of the market price of the home.
Housing associations will be given £4bn from the Treasury’s purse to fund more Shared Ownership schemes, allowing people to purchase a proportion of a new home and pay a subsidised rent on the balance. Buyers will be able to increase their share as they can afford to, with the aim that they can eventually own their property outright.
There will also be an extension to the Intermediate Rent scheme, with another 10,000 new homes pledged that will allow a tenant to save for a deposit for up to five years while they pay a subsidised rent.
Last month, housing minister Brandon Lewis told WhatHouse? editorial director Rupert Bates, at a debate at the Houses of Parliament: “86% of people in this country want to own. There are a lot of niche products – Shared Ownership, affordable rent, social rent and the private rented sector [PRS].
“We want to make sure we turn all the dials on the housing sector demand and supply to get the overall picture right. But we will do everything we can to support homeownership.”