MP Kit Malthouse has admitted that the Government will fail to keep its 2015 election promise to build 200,000 starter homes by 2020.
In 2016, the Government allocated £1.2 billion to the ‘starter homes’ programme, which aimed to build 200,000 properties exclusively for first-time buyers at a 20% discount on their market value.
When asked how many starter homes had been build since 2016, the housing minister stated: “At the moment, none”.
The National Federation of Builders (NFB) is not entirely surprised at the failure of the starter homes programme. Since its inception in 2015, they have asked ministers and civil servants how we can deliver homes under this scheme, but have not received any response or support.
Whilst many might appreciate Malthouse’s clarification that the scheme is a failure and has built no homes in four years, the lack of transparency remains worrying and feeds into wider concerns that developers have with the Government and local authorities, who do not appreciate how damaging lack of certainty is to SME house builders.
The starter homes programme could have delivered some planning certainty, as it would have added work to local pipelines. But Malthouse’s admission explains why developers were not sure how they could get involved with starter homes.
Richard Beresford, chief executive of the NFB, said “This is bad news for the UK’s housing market and exposes the poor level of trust in relations between the Government and SME house builders. The Government must rethink how it should work with the wider industry, and not just a few volume house builders. It must figure out whether it really wants to build affordable homes or just win plaudits for acknowledging the problem and appearing to try.”
Rico Wojtulewicz, head of housing and planning policy for the House Builders Association (HBA), said “The Government has let SMEs down by promising a scheme that we were best suited to deliver but never engaging with us to deliver it. As refreshing as Malthouse’s honesty is, it comes too late particularly as starter homes were included in the most recent revision to planning policy.
“House builders are doing everything in their power to fix the housing crisis. It would be great if the Government shared our commitment.”