Downturn hits HCA housing starts

Its preliminary end of year results show that starts on new low-cost homeownership homes have been one of the biggest casualties of the recession.

There were just 10,787 low-cost homeownership starts in 2008/09, down almost a quarter from the 14,000 target.

The results also reveal that work started on only 3,144 homes on English Partnerships land, down from a target of between 9,175 and 10,450.

English Partnerships merged with sections of the Housing Corporation and the Communities and Local Government department in December last year to form the HCA.

The agency funded some 50,000 new affordable homes in the financial year, investing £3.9 billion in the process. It also saw work start on more than 30,000 new rental properties, which met its target.

Chief executive Sir Bob Kerslake said 3,000 properties had been converted from shared ownership to intermediate rent in the third quarter of 2008/09 alone. But he said this did not mask the decline in new housing starts in the sector.

‘The biggest issue is that registered social landlords are much more reluctant to take sales risks,’ he said.

The HCA completed 27,501 new social rented homes, ahead of its target. It was just short of its target for finished shared ownership
homes, completing 19,743 instead of 21,600.

Sir Bob said he was ‘pleased’ with the results considering the financial climate and the challenge of launching the new agency.

And he revealed the HCA was planning to create a new panel of developers, which would provide on-call services to HCA-funded projects. This would see HCA partners, such as councils, get expert practical help with house building.

The HCA also plans to expand the advisory team for large applications - which currently helps councils deal with major planning applications in the south east - to serve the whole country.

The agency is still finalising its targets for the current financial year, but Sir Bob said it would not reduce its new start targets to make them easier to hit.

A spokesperson for the Home Builders’ Federation said it was ‘very impressed’ with the HCA’s flexible attitude and willingness to help kick-start stalled sector projects.