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Anger of the North: housing bosses fear Affordable Homes Programme rules will see money diverted to the South
Funding rules for the new Affordable Homes Programme (AHP) undermine the government’s ambition to ‘level up’ the North and could see cash diverted to the South of England, figures have warned.
Northern leaders fear ministers’ commitment to allocating around half of the £11.5bn in the AHP to homeownership products will see money bypass the region due to a lack of viability, while building for social rent will also be difficult.
Jon Lord, chief executive of Bolton at Home and chair of Greater Manchester Housing Providers, said the limited appeal of shared ownership for landlords and customers in the North could pose an issue.
“I think that money for homeownership could end up going back down South because we only have a limited amount of exposure we can accept and a limited amount of reserves, and you cannot be left with unsold shared ownership schemes,” he said.
Tony Stacey, chief executive of South Yorkshire Housing Association (SYHA), added: “The amount of the programme that’s going into homeownership is a concern for Northern organisations because that only works in certain areas.”
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Mr Stacey said for SYHA, homeownership programmes account for just a third of the developments they consider as it is not as viable as places in the South East where house prices are higher.
“What you will end up with is a lot of shared ownership being delivered down South – that’s where the levelling-up agenda isn’t working,” he said.
The half of the AHP which is for rented tenures has also caused anger among Northern leaders as social rent schemes will only be funded in areas of high affordability pressures.
Tracy Harrison, chief executive of the Northern Housing Consortium, said this aspect is “really disappointing” and warned that prioritising areas with affordability pressures is “out of kilter with the message around levelling up”.
Of the £11.5bn available between 2021 and 2026, £4bn has been earmarked for London – with social landlords in the capital warning that this sum would be insufficient to meet urgent housing need.
Alarm bells were also sounded last week over the financial viability of the AHP’s new model of shared ownership, which reduces minimum initial stakes to 10% and allows staircasing of 1%.
A spokesperson for the Ministry of Housing, Communities and Local Government said: “These claims are inaccurate.
“The government is committed to increasing the supply of affordable housing in all parts of the country.
“That’s why we’re investing £12.2bn through the Affordable Homes Programme – the highest single funding commitment to affordable housing in a decade.
“We will deliver a wide range of affordable homes of different tenures all across the country.”
Update: at 17.26pm 22/09/20
A comment from MHCLG was added to the story.
