Housing set to get £400m kick-start

David Cameron and Nick Clegg will pledge to break the “current cycle in which lenders won’t lend, builders can’t build and buyers can’t buy” when they announce the Government’s housing strategy this morning.

The £400m Get Britain Building fund will target housebuilding schemes that have stalled through a lack of development finance and is set to “unlock” the construction of up to 16,000 homes, with around 3,200 of these to be affordable properties, Downing Street said. The cash injection would also support up to 32,000 jobs, according to officials.

The report Laying the Foundations: a housing strategy for England is also expected to set out details on other policies to revive the industry and solve the homes shortage, including allowing first-time buyers to get bigger mortgages and boosting right-to-buy council home discounts.

Measures to end the “national scandal” of homes lying empty and to improve the quality of housing for older people will also be announced and the strategy will set out plans to make high earners living in social housing pay market rates, as well as guidelines for local authorities over large scale developments.

Nick Jopling, executive Property Director of Grainger plc, the UK’s largest listed residential landlord, said it was a welcome shot in the arm for the housing sector. “While it isn’t the full answer to the UK’s housing crisis, alongside the other measures expected in the national housing strategy, it will go some way to easing the chronic shortage of housing facing this country.”

The move comes as figures from property website Rightmove show house sellers have dropped their average asking prices by the largest cash amount for almost four years. All regions in England and Wales showed monthly price falls. Homes went on the market for an average of £232,144 in November, a 3.1 per cent fall on October’s prices.