Twitter Facebook RSS FEEDS

Government seeks housing crisis resolution

Wednesday, 16 July 2008 12:00 AM

Housing minister Caroline Flint has announced a package of measures designed to alleviate the current challenges in the housing market.

Key among the proposals is a so-called 'rent now, buy later' scheme, which will allow first-time buyers earning under £60,000 annually to rent a new home at a discounted rate for a period of two to three years.

It is hoped the affordable rent, which will be 80 per cent of the market rent or less, will enable the household to save for a deposit to eventually buy a share in the home.

The new scheme will be offered until the title Rent to Home.

"The package being announced today will both help people facing difficulties right now, and lay the foundations to help meet the long term housing needs of the country," said Ms Flint.

"That means being ambitious, but also practical and realistic, acknowledging not only the difficulties faced by individuals and families, but for those who work in the house building industry."

A new drive to build partnerships between the public and private sectors was also confirmed, with the aim of putting councils back at the centre stage of providing homes.

Under this new partnership between councils and the private sector, councils put forward their surplus land into the Local Housing Company and have a full part in agreeing the development, which must include at least 50 per cent affordable homes.

In return, private sector partners, provide the equivalent investment and homes and skills needed to build the homes.

The first four pilot Local Housing Companies (LHC) will be operate in Barking and Dagenham, Newcastle, Nottingham, and Manchester.

Ms Flint also announced more funding, beyond the £200 million already allocated, to buy unsold stock from house builders for affordable homes, could be made available.
The initial announcement was much criticised for the small sums involved - which would allowing the purchase of just 1,500 homes - with no firm commitments of additional funds made.

Finally, the measures will see the first tranche of a £510 million funding pot to reward councils who are working to bring land forward for development allocated.

"We are determined to continue to do everything possible to promote long-term stability and fairness in the housing market," said Ms Flint.

"The international credit crunch has created significant challenges not just for the UK housing market, but in other parts of Europe and the United States.

"However, the long term need to provide more homes has not gone away. We have a growing and ageing population and will only see worsening affordability unless we increase housing supply."

Some sectors of the property industry have welcomed the moves.

"It is reassuring to see the government finally offering much needed measures of support to the housing market," commented Nicholas Leeming, director of PropertyFinder.com.

"The schemes proposed to boost the building industry need to be implemented immediately and aggressively.

"Our research shows that at current expected building levels and household growth, England will literally run out of homes by 2011."

However, the Royal Institution of Chartered Surveyors (Rics) argues the scheme will not go far enough to help first-time buyers.

"Rent now, buy later schemes are one solution, but today's announcement only puts in place a pilot scheme and is restricted to households earning less than £60,000," said Rics policy officer, James Rowlands.

The organisation argues there will be little respite for people on lower quartile incomes, who will still struggle to save the £27,738 needed to pay the upfront costs of buying a house.

"It is time for the government to take bold action to tackle the problems in the housing market and innovative solutions must be put in place now to help people who want to buy a home but cannot get a mortgage," added Mr Rowlands.

"This measure will only have a limited impact on the wider housing market unless it is rapidly expanded to include all first-time buyers."

Chris O'Toole

Related stories

An ageing population may exacerbate the UK's housing crisis. Image:Thinkstock

Government urged to do more on housing crisis

Ministers stuck at red light on housing supply, private rented sector and homelessness, say housing groups.

 Service men and women to get package of help to buy homes or apply for social housing. Image: Thinkstock

Government pledges housing help for heroes

Service men and women to get package of help to buy homes or apply for social housing.
Green homes

Sustainable construction to help housing crisis

There are currently 80,000 too few homes being built each year. Could cost-effective, eco-friendly designs be the answer?

 George Clarke is ideal home improvements ambassador at the 2012 Ideal Home Show.

TV's George Clarke on UK 'housing crisis'

Ahead of the Ideal Home Show 2012, George Clarke tells AboutProperty why he thinks the UK is in a housing crisis and how he'd go about dragging us out.
Kate Barker spoke also positively about the draft national planning policy framework. Image:Thinkstock

Expert questions government housing policy

The author of a landmark 2004 housing review has accused successive governments of not building enough homes, during a speech to the British Property Federation (BPF).

 Parking on the streets around the tower might be a bit of a nightmare. Images rights owned by Teatum + Teatum.

Sky-high solution to London's housing crisis

Architects propose supertower high enough to touch the clouds and house 100,000 people.

Eric Cantona has retained a significant media profile despite his shock early retirement from football in 1998. Image:Allstar

Eric Cantona presidency stunt highlights French housing crisis

Reports that Eric Cantona is standing to be French president are wide of the mark, but he is instead looking to highlight a growing housing crisis in France.

 Garden Cities are intended to create a British "brain belt" to rival Silicon Valley

Could new Garden Cities solve housing crisis?

Think-tank says new cities with local consent would allow economic growth and lead to more homes where they are needed.
Osborne slashes social housing budget

Government slashes housing budget

Half of the social housing budget has been cut by George Osborne in today's spending review, although £4.5 billion worth of funds is set to be redirected into building 150,000 new homes.

 Use extra cash from increased council tax on empty homes to help bring them back into use, says Shetler Scotland. Image: Thinkstock

Scottish government urged to invest in empties

Use extra cash from increased council tax on empty homes to help bring them back into use, says Shetler Scotland.

Search property

Headlines

Directory

Alaris

Alaris Logo
Alaris specialise in quality Bathrooms and Kitchens along with many other unique products for your home. The range of kitchens, kitchen worktops and bathrooms is extensive and the highest quality so you are sure to find what you want. New bathroom furniture, bathroom suites, taps, showers and cabinets are added regularly.

Bathrooms365

Bathrooms365 Logo
Bathroom365 supply all areas of your new bathroom - leading-edge designed bathroom suites, stylish bathroom taps and showers, all styles and forms of shower enclosures and a vast collection of bathroom furniture.

Fitmykitchen

Fitmykitchen Logo
Fitmykitchen are specialist suppliers of kitchen appliances, sink taps, waste bins and furniture. So whatever you want from kitchen sink taps to waste bins look no further than fitmykitchen, UK, the specialist suppliers of kitchen appliances, stainless steel sink taps, waste bins and kitchen furniture.

MyStampDuty

MyStampDuty Logo
We help people buying property all over the UK to minimise Stamp Duty Land Tax on residential and commercial property. If you are looking at purchasing a new home or business premises over £500,000, contact us today by completing the form on the right

Oak Furniture Land

Oak Furniture Land Logo
For hardwood furniture, including Solid Oak, Mango, Mahogany, Sheesham, Acacia, Ash and Birch, look no further than Oak Furniture Land.

Rated People

Rated People Logo
Whatever type of home improvement or garden remodelling project you have, Rated People can help you to identify the right tradesmen for the job in a way that is quick, easy, convenient and, as it is based on real-life recommendations, trustworthy.

Residential Land

Residential Land Logo
If you are looking for short or long term rentals in Central London, Residential Land have a portfolio of over 1200 flats and houses in the best postcodes across the Capital.

Simply Bedrooms

Simply Bedrooms Logo
Simply Bedrooms, a part of Sleepwell Bedrooms Ltd, supplying quality beds, wardrobes, sliding door wardrobes and bedroom furniture at low prices and great service, London and Home Counties Specialists.

Door Handles UK

Door Handles UK Logo
Door Handles UK is the UK's largest online range of Door Handle accessories, Door Hinges, Locks and Latches and so much more and all at genuine internet prices. We have a wide range of Chrome, Brass and Glass Crystal Mortice door knobs in both traditional and contemporary designs, whatever your taste and budget you will find a design to suit.

Woodlands Furniture

Woodlands Furniture Logo
We are an established family business situated in rural Herefordshire specialising in beautiful handcrafted classic reproduction furniture. Our comprehensive ranges are readily available from stock.

WowBBQ

WowBBQ Logo
Welcome to the World of Weber. We are the largest independent online Weber BBQ retailer in the United Kingdom. WOWbbq.co.uk is a Weber Partner Store and can give you the best advice for all your Weber BBQ needs.

Join our directory aboutproperty.co.uk

Twitter

Join the conversation at #aboutproperty

Directory articles

What do you need to consider when buying a mattress?

If you looking for a new mattress, you need to get the decision right, as getting it wrong could impact on your overall health and wellbeing. As well as comfort and size, you also need to consider other points, such as any health issues you may have.

FAQs about commercial stamp duty

If you want to relocate to larger premises, you need to know about commercial stamp duty. Different rates apply than with residential property, however, like residential buyers, you could potentially benefit from stamp duty mitigation.

Save space with a small bathroom suite

Most people dream of having spacious bathrooms with a freestanding tub and a separate shower cubicle where you can relax in pure luxury. However, the reality is that bathrooms are rarely as big as we'd like them to be. Here are some tips on how to make the most of a small bathroom.