The housing sector has cautiously welcomed the government’s new ‘Plan for Jobs’, warning that more is needed to kickstart a housing revolution in the North of England.
In his summer economic update yesterday, the Chancellor Rishi Sunak announced a wealth of measures to spur housing’s recovery from COVID-19.
These included a temporary cut on stamp duty for homes under £500,000, a new £12 billion Affordable Homes Programme, and a £2 billion Green Homes Grant to make homes more energy efficient.
While commentators have praised measures to help people resume work and buy a home, housing leaders have warned that these alone won’t be enough to spur the economy on, with many people still forced into debt by high rents or unable to get onto the housing ladder.
Kate Henderson, chief executive of the National Housing Federation, said that measures like waiving stamp duty does not solve the problem of the ‘severe shortage’ of social homes or help those who are really struggling.
Henderson said: “Earlier this week we welcomed the government’s confirmation that funding for the Affordable Homes Programme will go ahead and the funding for a social housing retrofit pilot.
“But significantly more, long term funding, from government is needed to kickstart a building boom of social homes at the scale we desperately need.
“This is the only way to create enough affordable homes, re-build left behind communities across the country, create local jobs as well providing young people with access to enough training and employment support.”
One of the most-discussed announcements of the ‘mini-budget’ was the £2 billion Green Homes Grant, which invites homeowners and landlords to apply for vouchers to make their homes more energy efficient.
The scheme will cover up to two thirds of works to a maximum of £5000 per household, fully funding measures of up to £10,000 per household for homes on lower incomes.
The government has also promised to set up a new £3.8 billion Social Housing Decarbonisation Fund to help social landlords improve the least energy-efficient social rented homes, starting with a £50 million pilot this year.
Tracy Harrison, chair of the Northern Housing Consortium, which represents the views of housing associations across the North of England, called the voucher scheme a ‘good start’ in recognising the job-creating potential of home retrofit, especially in the North of England.
She said that home retrofit across all tenures could create over 20,000 jobs in the North of England, where homes are generally ‘older and colder’.
“The Chancellor’s next step should be to bring forward the promised £3.8bn social housing decarbonisation fund – so that councils and housing associations can retrofit homes at scale and speed,” Harrison added.
“This will maximise the job-creation potential of retrofit and contribute to government ambitions on net zero and levelling-up.”
While housing associations have largely focused on the government’s new – or lack of – affordable and social housing initiatives, other commentators said the cut in stamp duty has not been given enough recognition for the role it could play in stimulating new home starts and creating jobs.
Public Sector PLC said the stamp duty cut will give housebuilders more confidence to get ‘shovels back in the ground’ by helping to drive up demand from prospective house-buyers.
The public sector property company added that investment in modern methods of construction (MMC) is needed to enable regions like Greater Manchester to hit zero carbon new building targets.
Paul Brown, CCO at Public Sector PLC, said: “While we can now deliver zero carbon homes, it is important to emphasise that more central government investment in MMC is needed.
“[This would] enable areas like Greater Manchester and Leeds to reach their target for all new buildings to be zero carbon by 2028 and 2030 respectively.”
Brown added that if the government wants to accelerate its ‘levelling up’ agenda, it should rewrite the Treasury’s Green Book, which drives investment to regions under the ‘highest affordability pressure’ – mostly the South East of England.
He cited recent analysis from Homes for the North which found that only four out of 72 Northern local authorities qualify for Homes England funding on the basis of affordability.