PRESS RELEASE: House Building Industry Calls for Clearer Policy on Future Affordable Housing

Published: 16 September 2011 | Author: Colm Quinn

The Housing Forum, a professional network representing housing providers and firms that make up their supply chains, is urging the government to set out a clear long-term vision for affordable housing in England and Wales.

The call comes at a time when industry surveys show the number of starts on new homes continuing to fall and registered providers are coming to terms with the detail of the government’s 2011-15 Affordable Homes Programme.

While the programme was oversubscribed, most large housing associations expect to build 30-50% fewer homes than in previous years. The level of grant has been reduced by nearly two thirds, with associations instead dependent on charging higher rents or providing cross subsidy from other activities. Most providers believe this will prove to be a “one-off” exercise that cannot be repeated in future years.

According to The Housing Forum, there is still a need for some form of subsidy even though the majority of homes may be funded through the affordable renting model. Shelagh Grant, its Chief Executive, said there was uncertainty among builders and contractors as to how effective the new model will be, but it seemed certain that the number of homes built would be well short of that required across the country.

“It is important to remember that affordable housing requires some form of subsidy,” she said. “If this is no longer provided at viable levels through grant, then other forms of financial support will have to be found.”

The Housing Forum is calling for greater collaboration between the public and private sectors. But it also wants housing associations, which will deliver 90% of the 2011-15 programmes, to be given the flexibility to devise their own business models. This will allow them to explore other ways to find extra capacity. Barry Munday, Chair of The Housing Forum, said house builders were trying to envisage the outlook for the industry beyond 2015. “There is no doubt that we face major challenges in providing the number of homes required both in the short and longer term,” he said.

“Leaving all decisions on housing growth to local authorities is unlikely to provide the numbers of new homes needed. A clear statement from government over how it intends to fund and support house building would assist the sector as it plans ahead.”

For further information contact Shelagh Grant at The Housing Forum (tel: 020 7648 4070).

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Notes to editors

1. The Housing Forum is a unique cross-housing industry network that brings public and private
sector organisations together to influence emerging policy and promote excellent practice.

2. The Homes and Communities Agency announced on July 14th that 146 registered providers
would receive a total of £1.8bn during the period 2011-15.

3. The money will fund 80,000 affordable homes, bringing the total number expected to be built
to 170,000 - exceeding the government’s original target by 20,000.

ENDS