£3.7bn investment in housing infrastructure and affordable housebuilding announced in Autumn Statement.
Chancellor Phillip Hammond has announced £3.7bn to help deliver new housing across the UK. £2.3bn is to be allocated to a Housing Infrastructure Fund helping to unlock around 100,000 new homes in areas of high demand.
In a boost to affordable housing £1.4bn will help deliver an additional 40,000 homes. This money will be on top of the existing £4.7bn set to be spent on affordable housing over the next five years. He also announced that restrictions on government grant would be relaxed, “to allow a wider range of housing-types.”
The Chancellor called this commitment to housing delivery, “a step-change in our ambition to increase the supply of homes for sale and for rent, to deliver a housing market that works for everyone.”
The housing and construction sectors have reacted to the announcements:
Stephen Stone, Chief Executive of housebuilder Crest Nicholson: “Crest Nicholson welcomes Philip Hammond’s commitment to double annual capital spending on housing, investing £1.4bn in affordable housing in order to deliver 40,000 new homes, alongside a £2.3 billion investment in infrastructure around new housing developments. The UK continues to be challenged by a short supply of suitable, affordable housing stock in addition to ambitious targets to reach in order to meet a growing population. Ultimately this investment should help to make the dream of owning a house a reality for a significant number of people.”
Sarah McMonagle, Director of External Affairs at the FMB: “The Chancellor’s £2.3 billion Housing Infrastructure Fund is welcome and could go some way to solving the housing crisis. The burden of funding local infrastructure for new homes should not fall entirely on private house builders – however, as council budgets have been stripped back, local authorities have increasingly looked to developers, including even the very smallest developers, to plug these funding gaps. Heavy demands for Section 106 and Community Infrastructure Levy can make many small developments unviable. Key to the Fund’s success will be to ensure that it focuses on unlocking large numbers of small sites and not just small numbers of large sites.”
Melanie Leech, CEO of the British Property Federation: “This Budget’s hidden gem is the spending on infrastructure to help bring forward housing sites. Infrastructure spending is housing delivery’s silver bullet and the considerable commitment to invest about £2bn a year is therefore very welcome. The £1.7bn for accelerated construction on public land will also help upscale the modular construction sector, meaning a more efficient industry and the faster delivery of homes.”
Carl Dyer, Head of Planning at Irwin Mitchell: “Disappointingly, there was no mention at all of retirement housing. Mr Hammond could have had a far greater effect on supply of housing if he had incentivised the construction of retirement living and care homes. If just half of the elderly people who say they want to downsize their property were to do so, that would release 3,500,000 homes onto the market. That is something like five Parliaments’ supply at current rates of construction.”
John Newcomb, Managing Director of the Builders Merchants Federation: “We welcome the Housing Infrastructure Fund. It will help to invigorate the market by encouraging house building, particularly in areas like London where housing is in high demand. It will also help to create jobs and growth in construction and the wider U.K. Economy. This is good news for merchants and we expect to see a continuation of September’s strong timber and joinery sales as construction work generated by the fund begins.”
Matt Pullen, Managing Director of AkzoNobel UK, makers of Dulux paint: “The Chancellor is right to identify the need for more affordable homes as a top priority. His commitment to double the annual spend on housing will help to address the UK’s housing deficit and deliver a welcome boost for the construction industry.”
For more reaction from industry click here.
