Hammond reported in his statement that he believed the Government had made ‘good progress’ on house building. However, the pace of change was not going to reach everyone, especially those most in need. Living in expensive rented accommodation was a drain on the economic wealth of many.
As a result, the Communities Secretary, Sajid Javid, will bring forward a white paper to confirm the allocation of a £2.3billion Housing Infrastructure Fund. This will aim to unlock land to deliver up to 100,000 new homes in areas of high demand.
A further £1.4billion will deliver 40,000 additional affordable homes, together with a relaxation on the restrictions on government grants to allow a wider range of housing-types.
London’s Affordable Homes Programme will also get a boost. Currently sitting at £1.07billion until 2018 it will rise to £3.15billion between now and 2021.
This additional investment is being packaged alongside money already pledged in the Home Builders Fund, including pilot building on public sector land with funding of £2billion. A further £1.7billion is being invested to accelerate the process. This will be done by 2020-21 through private sector developer partnerships.
The news was welcomed by the National Association of Estate Agents (NAEA) but it warned that 40,000 new homes is still painfully short of the number of affordable homes needed to solve the housing crisis and get first time buyers on the housing ladder.
The house building investment programme is sure to be welcomed by small house builders, as they look for relief from the challenges of the current planning system, industry skills shortages and uncertainty over how Brexit negotiations will impact their business.
But there will be a lot of questions over how the money will be used. Small developers will want to know when they will be able to get access to the funding. It will take time for this to translate into land buying, planning and then construction.
Remaining complexities such as the current planning regime, lending and local council bureaucracy, are still impacting smaller developers, who are hardest hit when it comes to securing bricks and mortar projects.
In all, a statement designed to show that Britain was looking to invest to grow and balance its economy across the country. It shows real intent to accelerate affordable housing development that can keep pace with population growth. The key will be how this money works its way through the system and how in line with local authority appetites to unlock available sites.
But this does not necessarily mean a house building gold rush. Checks and balances on planning controls are sure to remain securely in place alongside this investment enthusiasm. That enduring tension may not be eased any time soon.