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Government fails to deliver starter homes

Michael Lloyd

November 5, 2019

The government has failed to deliver any starter homes since the framework for the relevant legislation received Royal Assent in 2016, the National Audit Office (NAO) has found.

The relevant sections of the statutory framework for Starter Homes, the Housing and Planning Act (2016), have not yet come into force.

The Ministry of Housing, Communities & Local Government (the department) expected to introduce the secondary legislation and planning guidance required for starter homes in 2019 but it is yet to lay the regulations in Parliament.

Meg Hillier, the chair of the public accounts committee, said: “Despite setting aside over £2bn to build 60,000 new starter homes, none were built.

“Since 2010 many housing programmes announced with much fanfare have fallen away, with money then recycled into the next announcement.

“The department needs to focus on delivery and not raise, and then dash, people’s expectations.”

Between 2015-16 and 2017-18, the department spent almost £174m preparing sites originally intended for building starter homes.

Although £26m of funding had been made available by the department, the full amount was not spent. This was because Homes England did not identify enough sites within 2015-16, the year when the funding was available and the money that was left was returned to HM Treasury.

Since August 2015 the department has spent £6.45m supporting local authorities to deliver new homes.

The November 2017 Autumn Budget reallocated funding earmarked for starter homes to the £9bn Shared Ownership and Affordable Homes Programme and the Land Assembly Fund (LAF).

In 2016-17 and 2017-18, the department spent £151m under the Starter Homes Land Fund (SHLF), but the spending has not supported the building of starter homes.

The department used the SHLF to acquire and remediate suitable land to then sell on to developers.

It forecasts the spending will create 1,268 affordable homes and 3,907 market homes; however, without the necessary secondary legislation, the homes cannot be marketed as starter homes.

Neil Knight, business development director at Spicerhaart Part-Exchange and Assisted Move, added: “It is clearly disappointing that there has been so little progress on delivering the starter homes the country needs – but if the land earmarked by the project is still going to be used for housing then it is not entirely wasted.

“It remains absolutely crucial to bring more land into use for new homes to meet the demand not just of first-time buyers but of people looking to upsize as their families grow, or downsize in later life.

“This does not need to mean concreting over valuable Green Belt sites: recent analysis by the Campaign to Protect Rural England has found there are more than 18,000 brownfield sites, and more than 26,000 hectares of brownfield land that could be built on.

“What we need to hear from politicians is what they are going to do to help bring this land into use.”

A spokesperson for MHCLG said: “We are committed to building more homes and supporting people into homeownership.

“We have a great track record, with housebuilding at its highest level for all but one of the last 30 years – with 222,000 homes delivered last year and 1.3 million in total since 2010, including over 430,000 affordable homes.

“The number of first-time buyers is currently at an 11-year annual high, and over 560,000 households have been helped into homeownership through government schemes like Help to Buy and Right to Buy.”


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