Government pledges £2bn of extra funding for housing associations

Sep 20, 2018

As extra £2 billion will be available for housing associations from 2022 to build and manage tens of thousands of properties.

Speaking at the National Housing Federation (NHF) Summit today, Prime Minister Theresa May commented that social housing is not the tenure for second class citizens. She said that that housing associations have the tools to build homes and take on major developments themselves, rather than acquiring a proportion of properties that commercial developers build.

The National Federation of Builders (NFB) welcomes the extra funding, but thinks that the country cannot afford to wait until 2022. In addition, the NFB is sceptical that the language used focuses on major developments but not the broken planning process.

Housing associations play a key role in diversifying the housing market, as well as delivering a wide range of sites. However, typically partnering with small and medium sized builders (SMEs), they experience many of the same barriers to building that the non-volume sector faces.

It is therefore frustrating to notice the lack of reference to the inefficient planning and plan-making process, affecting the major developments that the prime minister would like registered providers to deliver.

Richard Beresford, chief executive of the NFB, said: “NHBC Foundation research identified that 40% of small builders build for housing associations because the supply barriers SMEs face are also encountered by registered social landlords.

“We are disappointed to see that both the government and the opposition avoid discussing the elephant in the room: the broken planning process.”

“Extra funding for £2 billion is extremely welcome, but it will not be accessible until 2022, it will not fix the inefficient planning process and does little to dispel the negative myths around social housing.”

Jackie Bennett, director of mortgages at UK Finance, said: “Today’s announcement provides much needed certainty regarding the government’s commitment to the social housing sector, enabling housing associations and their private funders to plan and build for the future.

“Affordable housing across the UK is an economic and social priority and lenders are committed to playing their part. The industry provided £8.6 billion of private finance for social housing in 2017, helping to fund affordable homes across the country.

“UK Finance and its members now stand ready to work with the government and housing associations to support long-term investment in affordable homes.”

Article originally posted by Mortgage Finance Gazette