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Kent Housing Group 10 th September 2013 Terrie Alafat Director, Housing Growth and Affordable Housing Department for Communities and Local Government.

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Presentation on theme: "Kent Housing Group 10 th September 2013 Terrie Alafat Director, Housing Growth and Affordable Housing Department for Communities and Local Government."— Presentation transcript:

1 Kent Housing Group 10 th September 2013 Terrie Alafat Director, Housing Growth and Affordable Housing Department for Communities and Local Government

2 2 A Housing Strategy to increase supply Supporting demand Recognition of aspiration of home ownership Increasing demand for rented homes Increase housing supply Across all tenures – addressing barriers Underpinned by systemic reform Planning Greater land availability Getting house building moving again is crucial for economic growth – having a direct impact on economic output, averaging at 3% of the GDP in the last decade.

3 3 The Challenge: Barriers to supply

4 4 The Challenge: Barriers to demand From 2000-2007, annual mortgage lending increased by 200% Lending broadly flat since Mortgage Lending Sharp fall in annual mortgage lending in 2007-8. First time buyers particularly hit as deposit requirements soared First Time Buyers – Deposits as % of Income Demand for private rented housing is growing - the sector now houses 3.8 million households in England, compared to 2.0 million in 2000..

5 5 Supporting Home Ownership NewBuyRight to Buy Expanding Rented Sector Unlocking Housing Development Help to Buy: Equity Loan Affordable Homes Programme Build to rent Debt Guarantees PRS taskforce Local Infrastructure Fund Get Britain Building Public sector land Growing Places Fund £3.5bn, £1bn Guarantee 75,000 plus transactions Nearly £6bn, £10bn Guarantees Up to 210,000 homes £1.6bn Unlocking capacity for over 120,000 homes - 11,000 started on site Delivery to 2015 PLANNING REFORM

6 6 2013 has shown the most positive signs to date of recovery in housing market activity Quarterly housing starts hit their highest point since 2010 BUT starts and completions are down on the long term average The flow of residential planning approvals in Q1 2013 7% higher than a year ago.

7 7 This is driven by improved demand and consumer confidence Value of mortgage lending up 29% from a year ago. Strongest lending since October 2008.  30% increase in number of loans to FTB in year to June 2013. Quarterly lending to first-time buyers was at its highest since 2007. And reservations on site are moving ahead of seasonal trends.

8 8 Builders are responding to better market conditions Construction orders are at their highest level since 2008. UK construction PMI showed the fastest rate of growth in 6 years (since September 2007) – and the fourth consecutive month showing a positive change, driven by residential construction. And there are more units progressing towards a start – 11% more in June 2013 than in June 2012.

9 9 Spending Round: housing package DEMAND Help to Buy: Equity Loan £1.3bn in 15/16 Help to Buy: Mortgage Guarantee LAND £102 million to unlock large sites Strategic review to identify Government surplus land and set disposal target HCA will be Land Disposal Agency AFFORDABLE HOMES Affordable Homes programme £3.3bn, plus Guarantees Rent certainty CPI + 1% New £400m Rent to Buy programme PRIVATE RENTED SECTOR Build to Rent £300m 15/16 Guarantees LOCAL GROWTH £2bn/yr local growth pot local transport investment

10 10 Spending Round: Affordable Homes Delivery £3.3bn package for 165,000 new affordable homes over 3 years from 2015-16. Stronger focus on driving out efficiencies and managing assets actively. Rent certainty - rents in the social sector will increase annually by CPI + 1%, for ten years, from 2015/16. £400m to pilot a new approach to affordable housing in ‘Affordable Rent to Buy’.

11 11 Spending Round: Local Authority assets £100m for stock transfer in 2015/16 with strong value- for-money and tenant support. £160m for Decent Homes targeted at authorities to reduce greatest backlog. Aim to ensure no authority will have more than 10% of stock non-decent by 2016.

12 12 What will this deliver? Aiming for 55,000 affordable housing starts a year, the highest rate of new build affordable housing for at least 20 years Current programme demonstrated the sector’s ability to drive efficiency and deliver more with less public subsidy New programme provides the long term investment framework landlords asked for. In return, we will look for: Continuing focus on efficiency and value for money Opportunities to make more of the asset base – including the range of options on re-let Non-developers and under-developers to consider their capacity to start building

13 13 Homelessness Recognise pressures arising from: Affordability (linked to supply) Welfare Reform Government maintaining support to VCS and LAs - £470m over the current SR Gold Standard for homelessness services – includes commitment to limit B&B for families. ; Statutory Homelessness Acceptances and use of Temporary Accommodation still well below 2003 peak - though increasing.

14 14 Where next? How will housing associations use flexible tenure, rent certainty and increased efficiency to drive investment in affordable homes? Will Affordable Rent to Buy offer new opportunities to meet housing need in Kent? What more can local authorities do with their land and assets to support supply? Will housing be a key part of your LEP’s draft local growth strategy due in the autumn?

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