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London mayor pledges extra £200m to help housing associations navigate Brexit uncertainty

The mayor of London has promised to provide a package of measures to help housing associations navigate through uncertainties brought about by Brexit, including an extra £200m for the capital’s Affordable Homes Programme to support the development of new homes.

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London mayor @SadiqKhan pledges extra £200m to help housing associations navigate Brexit uncertainty #ukhousing

James Murray, deputy mayor for housing and residential development, has written to London-based housing providers to reassure them as they make plans for the possibility that the UK crashes out of the European Union without a deal. The deputy mayor and his team are planning to meet housing associations by the end of the month in order to agree how “additional Greater London Authority (GLA) investment” could secure the development pipeline amid concerns about the property market, even if a deal is agreed.

Mr Murray suggested that housing associations would be allowed to shift homes from market or low-cost sale to rent in order to offset any weakness in the property market due to Brexit.

They could be offered negotiated grant rates to increase the proportion of homes at social or intermediate rent levels on their development sites, or have flexibility to let unsold shared ownership homes on intermediate rents for a period of time. This could also be done via additional grant, he said.

Mr Murray said the GLA have “been able to identify £200m of budget headroom” to supplement the Affordable Homes Programme, which it wants the government to match. This money will be available for housing associations with homes starting in 2019, and will depend on the schemes being in their planned pipelines and those already underway.


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The GLA said it plans to ask the government for additional financial support for homes planned until 2022. The mayor has a target to build 116,000 affordable homes in the next three years.

Mr Murray wrote: “I am acutely aware from conversations with housing associations in recent months that the ongoing uncertainty around Brexit is severely straining the already stretched cross-subsidy model because of falling sales and enquiries and uncertainty around values.”

“It is vital we continue to build affordable housing despite the impacts of Brexit, and so I am writing to you with an offer of support.”

The latest pledge from the mayor’s office comes just weeks after he wrote to housing secretary James Brokenshire in a letter co-signed by Paul Hackett, chair of the G15 group of the largest housing associations in London, and Darren Rodwell, executive member for housing and planning at London Councils, outlining the immediate emergency support which would be needed from the government if the UK leaves the EU with no deal.

Mr Brokenshire is yet to respond to the letter.

Commenting on the latest offer sent to housing associations, Sadiq Khan said: “We must not let the government’s chaotic mishandling of Brexit undermine our plans.

"That’s why it is right we push our funding to its very limits to keep housing associations building more affordable housing through the ongoing uncertainty – and it’s even more important given the government totally failed to address my concerns when I recently raised them.

“Whatever happens with Brexit, ministers must, at the very least, match my support and ensure we can keep building the homes Londoners need over the coming years.”

The extra money was welcomed by the G15. Helen Evans, deputy chair of the group and chief executive of Network Homes, said: “The current market uncertainty limits our ability to generate cross-subsidy to reinvest in affordable homes so this strong, positive action to address that is welcome. If enough additional funding is made available, we will be able to continue to commit to new developments and increase the levels of affordable homes we are building.”

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