Housing blooms in Spring Statement

By Kasia Banas, Consultant

While mostly overshadowed by the Brexit debates and votes, this year’s Spring Statement included a number of important housing announcements. The new package is part of government’s wider strategy to deliver 300,000 a year by the mid-2020s and includes new infrastructure funding, reforms of parts of the planning system and increasing energy efficiency of new builds.

Housing Guarantees

The Chancellor confirmed that £3 billion will be available in loans to housing associations, to facilitate delivery of 30,000 new homes across the country through an Affordable Homes Guarantee Scheme. The funds will come from the £8 billion of housing guarantees announced in his 2017 Autumn Budget. It also includes £1 billion for small and medium enterprise housebuilders in the private sector which will open to applications from banks in April.

Housing Infrastructure Fund

£717 million from the Housing Infrastructure Fund will be used to support the delivery of homes at sites across London, Oxfordshire, Cambridge and Cheshire. In addition, a declaration between the government and local authorities in the Oxford to Cambridge growth arc was published. It includes a list of steps to be taken in the next 12 months, such as completing a study of new or expanded settlements in the arc and an independent chair to a Cross-Arc Advisory Group will also be appointed. According to the document, it has not been decided yet whether a “spatial vision” for the Oxford to Cambridge growth corridor will be developed.

Letwin Review

In response to Sir Oliver Letwin’s review of build-out rates, the government will publish new planning guidance on timely delivery of large sites. This will include the recommendation of increasing diversity in range of homes on sites of more than 1,500 dwellings. However, once again, there was no mention of extending councils’ powers to allow them to capture land value uplift.

Accelerated Planning Green Paper

A new ‘Accelerated Planning Green Paper’ will also be published to speed up decision-making within the planning system. The new measures will include greater capacity and capability, performance management and procedural improvements and follow Rosewell Review’s recommendations to reduce the time taken to conclude planning appeal inquiries.

Permitted rights

The government confirmed the changes to permitted development rights including upwards extensions to deliver additional homes and relaxation of use class rules to boost declining high streets. The Housing Secretary, James Brokenshire stressed however, that new rights would have to deliver homes that “respect the design of the existing streetscape, while ensuring that the amenity of neighbours is considered”. There is still no decision on proposals to allow office demolition for new homes.

Future Homes Standard

A Future Homes Standard will be adopted by 2025 to ensure that the new homes are built with the latest green technology, making them energy and cost efficient. The announcement echoes Prime Minister’s commitment to the Clean Growth Grand Challenge mission which aims to reduce the energy use of new build property by half by 2030. Consultation on the new standard is expected to take place later in the year.

Voices from the sector

While the announcements relating to new funding gained a lot of coverage and received a general support from the sector, Melanie Rees, head of policy at the Chartered Institute for Housing, said the statement was “another missed opportunity to get us closer to building the homes that we need”. She was joined by Adam Morton, policy leader at the NHF who agrees that “funding is only part of the solution”. He claims that despite their readiness to deliver homes, housing associations need more access to cheaper land. Polly Neate, chief executive of Shelter criticised expansion of permitted development rights. In her view, this deregulation will lead to a loss of thousands of potential social and affordable homes as planning authorities will have no way of getting developers to commit to Section 106 agreements.