09 Mar Time to Balance Housing Funding
The government’s ambition to solve the housing crisis will not be possible if an imbalance in housing funding continues, the Chartered Institute of Housing (CIH) has said, as new figures reveal just £8 billion of the £51 billion earmarked for housing up to 2021 will directly fund affordable homes.
The figures, compiled by the Chartered Institute of Housing as part of its UK Housing Review, reveal that despite a renewed commitment from the government to solve the housing crisis just 16 per cent of the total funding it has earmarked for housing over that period will directly support the building of new affordable homes.
Though some of the remaining 84 per cent, or £43 billion, may indirectly support the building of affordable homes, the vast majority will support starter homes, first-time buyers and the private market.
CIH said the government should urgently look at what it described as a ‘serious discrepancy’ between its commitment to solve the housing crisis and the balance of funding.
Terrie Alafat CBE, the chief executive of the Chartered Institute of Housing, said “We have seen in recent months what appears to be a genuine commitment from the government to solve our housing crisis and recognition that we need new homes for rent and sale.
“However we are concerned if the current imbalance in housing funding continues this ambition will simply not be possible.
“The government has rightly identified a need to build more genuinely affordable homes for the many people who cannot currently access a decent home and we have seen some very positive moves to get us building the number of homes we need.
“Though some of the infrastructure and other funding may indirectly support the building of affordable homes, it is also very clear that the government needs to go further to address the imbalance in funding to make sure the level of direct support for the building of new genuinely affordable housing reflects the desperate need for this type of housing.
“We fear the current balance of direct support will mean it is not possible to build the genuinely affordable homes for rent and sale which we so desperately need.
“We would urge the government to use the budget as an opportunity to address this to ensure its ambition to tackle the housing crisis can become a reality.”
The figures, compiled with the Department for Communities and Local Government, reveal that the additional funding announced in the Autumn Statement only increases the amount earmarked for affordable housing to 2020/21 to 16 per cent of the total investment, compared with 13 per cent when the same figures were compiled last year.
Of the £8.2 billion directly earmarked for affordable housing:
£4.3 billion is current Shared Ownership and Affordable Homes Programme (SOAHP)
£1.4 billion is the additional funding announced in the Autumn Statement
£1.5 billion is committed funding for the previous affordable homes programme
£400 million is earmarked for specialist homes for older, disabled and vulnerable people
£315 million is earmarked for care and support specialised housing fund
Of the remaining £43 billion funding though some may lead to the building of affordable homes through developer contributions, infrastructure investment and bringing forward new sites, the vast majority will stimulate the private market.