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The UK government has announced a £12.2bn ($16bn) plan to build up to 180,000 affordable homes over the next six years, and promised more social housing tenants will be able to part-buy their homes.
Around half the new homes will be for sale, another 40% will be let at “affordable and social rent,” and another 10% will be supported housing for people with physical and mental health issues.
But charities warned more homes were needed and must be genuinely affordable to fix a housing crisis, with almost 1.2 million households on social housing waiting lists in England last year.
Housing secretary Robert Jenrick also announced changes to England’s shared ownership schemes, in a bid to increase the number of buyers and make it easier for homeowners to increase their share of a property. Housing policy is devolved in Scotland, Wales, and Northern Ireland.
The reforms will reduce the size of the deposit needed to get on the ladder, with the minimum initial share cut from 25% to 10%. The move will eventually allow more housing association tenants to buy a stake in their own homes.
Shared owners will also see landlords cover the cost of any repairs and maintenance for the first 10 years after they buy, according to the government.
The government called its investment in new homes “the highest single funding commitment to affordable housing in a decade.”
But a press release by the ministry of housing, communities and local government on Tuesday committed only to “up to” 180,000 new homes, “should economic conditions allow.”
Private developers, councils, and housing associations will be invited to bid for funding for new homes this week.
The new homes planned for rent will include a right to shared ownership. Jenrick said ‘social rent’ homes were typically priced at around 50-60% of market prices. Affordable rents can be set at up to 80% of local prices.
The department said new home construction will begin from next year, with the programme running until 2026.
“Thanks to the range of flexible ownership options being made available, more families across the country will be able to realise their dreams of owning their own home, with half of these homes being made available for ownership,” said Jenrick.
A separate consultation has been launched on how to raise accessibility standards on all new homes.
Polly Neate, chief executive of housing charity Shelter, said the government needed to go further, with the new Affordable Homes Programme only envisaging 36,000 new homes a year from 2021 to 2026. Around 57,000 affordable homes were built in total in 2018-19.
“Achieving the step change we need to deal with the scale of crisis that we face will require the government to go further, faster,” she said.
Neate also sounded the alarm over the affordability of shared ownership, noting a government survey found three-quarters of private renters had no savings at all.
“Social homes are designed to be genuinely affordable, which is exactly what we need right now. Discounted home-ownership schemes are not.”