19 August 2005
Social landlords and developers will bid for a record £3.9bn to build affordable housing over the next two years.
The figure was confirmed by the Housing Corporation after the government announced that £5.5bn is being allocated to housing in 2006/08. Most of the remainder will be spent on improving council and private homes as well as regeneration schemes.
The £3.9bn for the corporation's National Affordable Housing Programme represents a £600m, or 18%, increase on the £3.3bn granted to registered social landlords in 2004/06. But competition for the money will be far greater this time round, with private developers and other non-RSLs now able to bid for grants.
Housing minister Baroness Andrews said the extra investment, which should lead to 75,000 new homes by March 2008, would help people 'unable to afford adequate housing as well as those having difficulty getting on to the housing ladder'.
Most of the £3.9bn is expected to go to the large housing associations, which received the lion's share of the money allocated last time, as well as to some developers. Many RSLs have set up consortiums with developers to increase their chances of gaining grants.
According to the corporation, up to 20% of the money will be held back for smaller or specialist housing associations. At least one quarter of homes will be built using modern methods of construction while all properties will have to achieve an EcoHome rating of 'very good'.
Jon Rouse, the corporation's chief executive, said: 'We will ensure that the quality of the homes we build continues to rise, as does the number of homes delivered for each pound of taxpayers' money we spend.'
All money, including that for council homes, is initially allocated through regional housing boards. A breakdown published by the Office of the Deputy Prime Minister on August 11 shows that London will have a regional pot of £2.28bn, while Northeast England is to receive just £180m.
Sarah Webb, director of policy at the Chartered Institute of Housing, said it was unclear if the money the government had set aside for achieving decent homes would be enough for the number of councils intending to retain their stock rather than transfer it to an RSL.
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