Thousands of extra homes expected as affordable bids announced

By: Alex Wellman
Source: Inside Housing
Published: 14 July 2011

Thousands of extra homes are expected to be built under the affordable homes programme after the government revealed figures for the scheme.

Grant Shapps, the housing minister, revealed that a total of 146 housing association, local authorities and other providers will be expected to deliver 80,000 new homes through the £1.8 billion government scheme.

Initially the programme was projected to provide 56,000 new homes but the increase means that a total of 170,000 new homes could be delivered by 2015 when taking into account the previous governments scheme. The previous total was 150,000.

London will be given the biggest boost with 35 per cent of funding and 27 per cent of new homes earmarked for the capital. Of the 80,000 new homes, 29 per cent will be larger family-sized homes with three or more bedrooms while almost 10 per cent will be supported housing and 9 per cent will be homes in rural areas.

The developments are subject to the bidding organisations signing contracts with the Homes and Communities Agency. The successful bidders, who include 26 local authorities, will be announced at noon today with contracts confirmed in early 2012 when the Department for Communities and Local Government's changes to housing revenue account are implemented.

Grant Shapps, the housing minister, said: 'When I launched the invitation for bids under the Framework in February, I said that my aspiration was to deliver more than 150,000 new affordable homes, and challenged the sector to deliver.

'The response from providers to the invitation for proposals under this programme has exceeded my original expectations, and I now believe that we will be able to deliver up to 170,000 new affordable homes.

'The programme I am announcing today includes around 80,000 homes for affordable rent or affordable home ownership, supported by funding of £1.8 billion from the Government.'

The HCA estimates that of the 80,000 homes housing associations will build around 85 per cent and the average property will be let out at 72 to 73 per cent of full market rate.

David Orr, National Housing Federation chief executive, said: 'Over the last few years, housing associations have repeatedly stepped up to the mark and delivered thousands of desperately needed affordable homes, demonstrating their determination to work on behalf of the most vulnerable members of our society.

'And today's news shows that they will continue to do all they can to help tackle the nation's housing crisis, even in a challenging environment. In many respects they are the embodiment of the Big Society in action.'

Pat Ritchie, chief executive of the HCA said: 'Our partners made extremely strong offers and I'd like to thank them and the HCA teams who worked so hard on this process.

'We expect to not only deliver exceptional value for money but also a programme that has a strong fit with local priorities as we move into the delivery phase of the affordable homes programme.

'I am particularly pleased that we will be directly funding so many local authorities through our mainstream programme for the first time, to deliver affordable homes that will make a positive difference to local people.'