An amendment passed yesterday would allow English local authorities to decide how many starter homes are built rather than have to meet the target set by ministers.
The Department for Communities and Local Government set out last month that developments of 10 homes or more would need to ensure one-fifth of properties are allocated to the Starter Home scheme, intended for first-time buyers.
However, an amendment tabled by former DCLG permanent secretary and now cross-bench peer Lord Kerslake said councils should be able to make decisions on starter homes based on its own assessment of local housing need and viability. The government was defeated by 280 votes to 194.
A second amendment to ensure that the 20% discount that is available to first time buyers through starter homes is repaid on a sliding scale if the property is sold within 20 years was also passed b y 275 votes to 181. The government had previously indicated repayment would only be required within five years.
Following the passage of the amendments, shadow housing and planning secretary John Healey said ministers had been losing the argument on the legislation, which will also require local authorities to fund the extension of the Right to Buy to housing associations.
“Peers from across the House of Lords have told the government that they must think again on their housing plans which will sound the death knell for new genuinely affordable homes, and is set to be a big let-down for those who want to own a home,” Healey said.
“Ministers must now urgently listen to the wider concerns with the Housing and Planning Bill, including on their own side, and come back with changes to improve this Bill.”
Responding to the votes, housing minister Brandon Lewis said the government is determined to help anyone who aspires to own their own home achieve their dream.
“The government believes it is wrong that a 30 year old couple’s aspirations should be thwarted by having to wait until they are 50 to benefit from the full value of their Starter Home,” he added.
"We will listen carefully to the points made in the debate but our commitment to introduce starter homes at a 20% discount for first-time buyers is unwavering."
