The housing minister has revealed that landlords taking part in the new £3.3 billion round of affordable rent will have to enter into ‘something for something’ efficiency deals with the government.
Speaking at the Chartered Institute of Housing’s conference in Manchester today, Mark Prisk told delegates that developing associations considering bidding for grant must consider all relets for conversion into affordable rent.
He said that landlords taking part in the 165,000-home programme would have to enter ‘something for something’ deals where they would have to find efficiencies, carry out conversions and disposals.
‘With all this money and this commitment, there will be expectations about efficiencies,’ he said. ‘We will need to maximise the value we get out of every taxpayers’ pound… In considering bids for grant, we will expect providers to bring forward ambitious plans for maximising their own financial contribution – and we will expect this to include a rigorous approach to efficiency, along with plans to maximise cross subsidy from your existing stock.
‘We expect providers to take a rigorous approach when looking at every relet and asking how they can use them to build more homes for more families. I expect the result to be a significant change in the number of homes that are either converted to be let at affordable rent or are sold when they become vacant.’
Tom Murtha, chair of housing charity Hact said on Twitter: ‘This is the sting in the tail and the beginning of the end of social housing for those in need.’
Mr Prisk confirmed, as tipped by Inside Housing, there would be £400 million for a ‘rent to buy’ scheme that will be designed in consultation with the sector.
He also revealed that the Homes and Communities Agency will now be the ‘default’ single disposer of all public sector land from 2015/16 and called on landlords to make available land that is sitting ‘idle’.
He said that the 165,000 homes the government is funding is the equivalent of 55,000 affordable homes a year – a 20 per cent rise on the number of affordable completions by the last administration.
CIH chief executive Grainia Long said: ‘We have been clear in our ask of government to make housing part of the UK’s infrastructure – today we are pleased this call has been answered.
‘However, in the final analysis affordable housing received £3.3 billion out of a £100 billion investment package – and this is modest. It is not the “game-changer” required to make a significant impact to alleviate our housing crisis.’
She added that the government had missed an opportunity by not lifting local authority borrowing caps to create a ‘boost’ in the number of homes being built, but praised the government for recognising ‘the need to integrate social and health care and back it with investment’.
Andy Rose, chief executive of the HCA, said: ‘This is a strong settlement for the sector. The commitment of £3.3 billion for affordable housing to build 165,000 new affordable homes reflects the government’s confidence in the sector and the HCA; as well as housing’s role in driving economic growth.
‘The announcement that the HCA will be the single public body charged with bringing surplus public sector land to market builds on the HCA’s role as the government’s key delivery partner in increasing the amount of public land for development and speeding up the rate at which it is brought to market.’