RSLs ready for new savings target

4 Jan 07
Social landlords and developers should meet a new target for cutting the cost of housebuilding, according to the Housing Corporation.

05 January 2007

Social landlords and developers should meet a new target for cutting the cost of housebuilding, according to the Housing Corporation.

The HC has been told by the Treasury that, from 2008/09, it must save 18% over three years on homes built for rent and low-cost ownership. This is on top of savings made by housing associations as part of the Gershon review.

Peter Marsh, the corporation's director of resources, said it had already cut the average grant per home from £31,000 to £26,800 between 2004/06 and 2006/08 — despite land and building costs rising faster than general inflation.

Gershon had demonstrated that registered social landlords can find savings, said Marsh. 'They have learnt how to drive down building costs. We know that it's something the sector can achieve.'

An independent review of the HC's National Affordable Housing Programme failed to conclude whether savings made in 2006/07 were the result of supply chain improvements or extra competitiveness following the decision to offer grant to private developers.

PFjan2007

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