THE Government has made a deal with Barclays Bank to shake up the housebuilding market by providing £1 billion of loan funding to smaller developers
Currently around two thirds of new homes are built by just 10 companies, according to the Ministry of Housing, but it is claimed that the new partnership with Barclays Bank, announced by housing secretary James Brokenshire MP, will break their grip on the housebuilding market.
“My priority as housing secretary is to get Britain building the homes our country needs,” Brokenshire said. “This new fund — partnering Homes England with Barclays — is a further important step by giving smaller builders access to the finance they need to get housing developments off the ground.”
Homes England will oversee the £1 billion Housing Delivery Fund, which will provide loan finance to help support small and medium sized developers.
According to the Ministry of Housing, new homes supported will include social housing, retirement living and apartments for rent. The fund will also seek to encourage innovation in the delivery of new homes, such as brownfield land and urban regeneration projects.
Support will range between £5 million to £100 million. Loan finance will be offered to those developers who are able to “demonstrate the necessary experience and commitment to building excellent new homes, whilst boasting a track record of delivering challenging projects on time and to target”, the ministry said.
“There is a vital need to build more good quality homes across the country,” said John McFarlane, chairman of Barclays Bank. “This £1 billion fund is about helping to do exactly that by showing firms in the business of house building that the right finance is available for projects that help meet this urgent need.”
Sir Ed Lister, chair of Homes England, added: “Homes England has been established to play a more active role in the housing market and do things differently to increase the pace, scale and quality of delivering new homes.
“The Housing Delivery Fund demonstrates Barclays’ commitment to the residential sector and will provide a new funding stream for SME developers to help progress sites and deliver more affordable homes across England.”