Government investment to build thousands of new homes

27 Jun 2014 12:47 PM

Eric Pickles announces millions of pounds of investment to boost the supply of new homes. 

Communities across the country are set to benefit from thousands of extra homes under new deals revealed by the government yesterday (26 June 2014).

Speaking at the Chartered Institute for Housing conference in Manchester, Communities Secretary Eric Pickles set out why housing is the cornerstone of Britain’s economic strength and social well-being.

He said considerable progress has been made to fix the broken housing market, but that there is still more to do and government will continue to get the country building more homes.

The Secretary of State announced millions of pounds of investment across a range programmes, to boost the supply of new homes in all areas of the housing market:

• over £53 million will accelerate construction of more than 7,000 homes on large developments in Manchester, Medway, Swindon and Kettering. The new deals will bring the total number of homes supported through theLocal Infrastructure Fund to over 80,000 since the scheme began in 2012

• the government has set aside £1 billion over the next 5 years for further rounds of the programme. So far 56 bids have been received which demonstrate the strong interest from developers in getting workers back on stalled large-scale sites and to deliver the homes. An announcement about the shortlisted bids for the first round of funding will be made later in the summer

• a new £3 million fund to help planning authorities tackle barriers to work starting on site – the fund will give authorities additional capacity to focus on issues such as finalising section 106 agreements and signing off planning conditions, to help get work started on sites as quickly as possible. The fund could accelerate starts on up to 85 sites with the potential for up to 25,000 homes

• over £49 million will support 3 new schemes under the Build to Rent programme in Hampshire and Croydon. The funding will help deliver over 540 homes specifically for private rent, bringing the total number of homes supported through the programme so far to over 1,600

• a new prospectus for a new £150 million investment fund for 10,000 ‘serviced plots’ will be published. The funding will help bring forward ‘shovel ready’ sites where people can hire a developer to build the home they want, a type of development known as custom build. A demonstration site at Park Prewett, near Basingstoke, will begin shortly

Communities Secretary Eric Pickles said:

In 2010 we inherited a paralysed housing market and a collapsing rate of construction. Since then we’ve delivered over 445,000 new homes, and house building is at its highest rate since 2007 and still climbing.

The resurgence in house building is clear evidence that the government’s long-term economic plan is working, but there is still more to do.

The investment we’re announcing today will help us meet this challenge by driving up the supply of new homes in every corner of the housing market. From new places for rent to people designing to those building their own properties – we will support and deliver the homes this country needs.

Further information

Local Infrastructure Fund

The government has successfully unlocked a further 4 major housing schemes through the Local Infrastructure Fund, bringing the total to over 87,000. The sites unlocked are:

• Manchester City Fringe: £18.8 million will unlock 1,500 new homes on the Collyhurst, Ancoats and Lower Irk Valley. The investment will pay for key road infrastructure and land acquisition needed to support the delivery of the scheme, which will ultimately include 7,000 homes

• Medway Valley: £19.5 million will unlock 2,350 new homes. The investment will pay for the Medway Valley Crossing which is an essential part of the infrastructure required in order to deliver 2 remaining residential sites on the east bank of the River Medway

• Tadpole Farm: £5.5 million will unlock a 1,695-home urban extension to the north of Swindon. The investment will pay for key access roads into the site, landscaping and drainage works to get the site ready for housing

• Kettering: £14.5 million will unlock the first 1,750 new homes of a proposed 5,500 urban extension, business and energy park to the east of Kettering. The investment will pay for key access road infrastructure, sewerage works and other site preparation to enable the first phase of the development to get underway

Build to Rent

The funding announced will support the delivery of new homes for private rent on 3 new sites under the Build to Rent programme, bringing the total to over 1,600 homes.

• Berewood, Hampshire: £6.3 million loan will deliver 106 new homes

• Aldershot, Hampshire: £23.7 million loan delivering 219 new homes

• Croydon, south London: £19.8 million loan will deliver 216 new homes

Serviced plots prospectus

A new £150 million investment fund will bring forward up to 10,000 serviced building plots for custom build housing. The fund is intended to incentivise a different way of bringing forward land for development, for sites of 10 homes or more.

There is significant demand for this form of housing across the country, yet only 1 in 10 of new homes are custom built every year. This is in stark contrast to our European neighbours who build about 50% all their homes this way. The government wants to change this and unlock the growth potential of this market to build capacity and diversify our house building industry enabling us to build more high quality new homes faster.

The fund is available to developers and community groups, either working individually or as part of a joint venture with individual custom builders or a local authority. The developer will prepare the plots for sale and may choose to work with individuals to build they home they want, subject to final approval from the local council of their plans. Alternatively individuals can buy a plot and then commission their own builder to build their home for them.

The funding will provide a repayable loan for infrastructure works to provide these shovel ready plots for sale. Bids will need to be submitted to the Homes and Communities Agency by 30 September 2014.