Autumn Statement commits £1.4bn to build 40,000 homes

AS broadly predicted, Chancellor Philip Hammond moved to act on the housing shortage with his Autumn Statement pledge to invest £1.4bn into a building programme for 40,000 affordable homes.

He also unveiled £2.3bn in infrastructure support for 100,000 homes in “areas of high demand”.

Hammond also promised to broaden the scale of the Government’s Right to Buy scheme and to continue support the Help to Buy scheme and the Help to Buy ISA.

“This will more than double the annual capital spending on housing,” he said. “And it represents a step change in helping to deliver a housing market that works for everyone.”

There was a further boost for hard-hard pressed families when Hammond confirmed the wide pre-Statement leaks that letting agents would be banned from charging tenants up front fees.

Up fees paid by tenants often amount to several hundred pounds but Hammond said: “It is wrong that tenants should be charged these fees.”

Richard Davis, tax partner at Deloitte in Yorkshire said: “The Chancellor has placed housing as the Government’s number one investment priority, with £7.2bn allocated to the construction of new homes to 2020/21. The programme includes £1.5bn in the next financial year, of which £1.1bn will be targeted on affordable housing.

“The scale of funding shows the Government’s determination to accelerate housing delivery. Restrictions on the type of affordable homes that housing associations and local authorities can deliver are being relaxed, so this paves the way to more innovative solutions.

“The Government is continuing to devolve power and investment to local authorities, and the GLA will receive £3.15bn to deliver 90,000 starts in London over the next five years.

“The supply-side focus is carried through into a commitment to invest in and unlock the release of land for housebuilding, particularly public sector land.

“Although this package of funding may take a year to build momentum on the ground, this will be a step change in broadening the composition of supply of new homes in London, which is currently at 25,000 starts a year, against the recognised need for 50,000 new homes.

“The funding for housing is to be backed up by a Housing White Paper which will provide an opportunity for the Government to introduce more measures to deliver new housing including streamlining the planning system, supporting the Build for Rent sector as well as SME housebuilders, all of which are important to tackling the housing crisis.”