Increasing housing supply
The government has pledged to increase the supply of housing, in order to:
- meet housing need
- reduce the long-term upward trend in house prices
- achieve a more stable housing market to provide better conditions for economic growth
- improve the affordability of housing enabling more people to buy their home.
National targets have not been set for new housing, but the government's ambition is to build up to 150,000 new affordable homes, upgrade existing homes, and assist first time buyers through the 2011-15 Affordable Homes Programme (AHP 2011-15).
New ways of maximising value for public money are being explored including making the best use of available public land to benefit communities. Other measures for increasing supply include:
- The New Homes Bonus
- Community Right to Build (as set out in the Localism Bill)
- Housing Market Renewal
- bringing Empty Homes back into use
Certain standards will apply to all new homes and these are brought together in the Code for Sustainable Homes (CSH). These include space, low carbon and Lifetime Homes standards.
Challenging global financial conditions
The 2008/9 global financial crisis and other factors is still severely restricting new mortgage loans, particularly to first time buyers. The resulting low pace of sales is affecting developers' financial plans and is, in turn, severely reducing developers' ability to provide new housing.
In an effort to minimise the impact this was having on delivering housing targets, the previous government introduced a number of measures to maintain momentum in the housing market and keep housing development on track. These included:
- £775m housing and regeneration capital spending which supported the construction industry from 2009-2011. A large portion of the money was used to build new homes for social rent, complete regeneration programmes and improve and repair social housing, including measures to increase energy efficiency
- Increasing flexibility around timing of funding - helping to increase the pace of approvals, improve providers' cash flow, encourage new starts, and stimulate wider market activity
- encouraging councils, with spend of £1.87bn, to build new homes and refurbish existing houses.
- A range of measures, supported by a fund of £200m, aimed to assist up to 6,000 households at risk of homelessness because of mortgage or second charge default.