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From the archive - the builders' budget

Inside Housing looks back at what was happening in the sector this week five, 15 and 25 years ago

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25 years ago this week, @natfednews warned grant cuts could halt development

15 years ago this week @LQHomesMatter #ukhousing

Five years ago George Osborne unveiled the 'builders budget' #ukhousing

25 years ago

Housing associations could be forced to stop building homes if grant rates were cut, the National Federation of Housing Associations warned.

A proposal was on the table that would reduce the subsidy for new social homes from 72% of the total cost, to 55% within the next two years.

The Nat Fed calculated that the change would result in an increased use of private sector loans, from about £600m a year to about £1.2bn a year. Associations would have to use their existing stock as collateral on such loans, the body predicted.

Rents would also have to rise, from about £48 a week to around £84 a week.

Jim Coulter, director of the federation, said: “In some parts of the country, housing associations may be stopped from building new homes.”

In 1993, associations warned development could be halted (picture: Getty)
In 1993, associations warned development could be halted (picture: Getty)

Picture: Getty

15 years ago

Inside Housing reported on which English housing associations had received the most grant to support the construction of new social housing, with L&Q topping the list.

The association received £48m to build 487 homes (or just under £100,000 a unit). Home Group was next on the list, receiving £45m to support the construction of 723 homes (about £60,000 a unit).

The numbers show that funding also went to smaller housing associations. Community Housing Association received the third-largest slice of the pie, with £24m going to build 283 homes.

Of the total £1.2bn distributed by the Housing Corporation, 20% was to be used to build on greenfield sites.

£58m went to build in the Thames Gateway, to produce 974 homes.

But in the opinion pages, Valerie Owen, then managing director of regeneration at London First, which promotes the capital, pointed out that fewer homes were being built in London than at any time since 1924.

“The lack of affordable housing is frequently cited by business as an issue which could affect London’s position as a world-class city,” she wrote.

Our front page this week in 2013
Our front page this week in 2013

Five years ago

Five years ago, Inside Housing’s front page splashed the headline: “The builders’ budget”.

This was a reaction to chancellor George Osborne pumping £5.8bn into the housing market, meant to stimulate buyer demand. £3.5bn was to be spent in equity loans and £130bn of mortgages would be underwritten. Support for affordable housing was also increased, with a planned delivery of 30,000 homes.

Landlords warned that the grant rates – of £15,000 per home – would be too low to support the building of 30,000 homes.

Waqar Ahmed, finance director at L&Q, said that the funding was “insufficient to meet the needs in the sub-market rent category. This is where housing associations have a role to play in using our surpluses.”

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