Darling told to increase funding for buying up unwanted homes

20 Nov 08
The government is coming under increasing pressure to set aside more money to buy up unwanted homes from private developers

21 November 2008

By Neil Merrick

The government is coming under increasing pressure to set aside more money to buy up unwanted homes from private developers.

The Home Builders Federation wants Chancellor Alistair Darling to announce in the Pre-Budget Report that he will increase the existing £200m pot tenfold to buy around 15,000 homes that are standing empty across England.

The HBF's appeal came as it emerged that £90m has now been allocated – mostly to housing associations – while the Housing Corporation is considering bids to spend as much again over the next few months.

Speaking at a major housing conference in York on November 18, Richard McCarthy, director general for housing and planning at the Department for Communities and Local Government, said enough money had been allocated to purchase 2,600 homes.

He urged housing association leaders attending the Northern Housing Summit to take the opportunity to buy up more homes and gain maximum benefit from the government's three-year National Affordable Housing Programme.

Speaking later to Public Finance, McCarthy said it was almost certain that the £200m sum would be exceeded. 'We all have a responsibility to be more flexible and ensure that the programme achieves maximum impact in the current environment,' he said.

Although ministers stress that the £200m is not capped, they have yet to indicate how much of the £8.4bn NAHP funds they will devote to buying existing homes rather than building new stock.

With associations struggling to raise private finance to supplement grants, it is possible that not all of the NAHP money will be allocated by 2010/11. But existing private homes do not meet the same environmental standards as new properties built under NAHP regulations.

John Slaughter, the HBF's director of external affairs, said its calculations were only 'broad brush' figures and included other support required by private builders. 'There is substantial scope for doing this type of thing given that it's likely that the £8.4bn is going to be significantly underspent,' he added.

PFnov2008

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