Social Housing Speed Read – Starter Homes
9th January, 2017
Who will the Starter Homes be available to?
The provision of these new homes will be exclusively for those first-time buyers between the ages of 23 and 40 at a discount of at least 20% below the market value of the properties.
Such discounts will apply to properties that are worth up to £450,000 in London or up to £250,000 outside of the capital.
It is hoped this will have a positive effect in enabling many first-time buyers to enter the property market and ultimately become a homeowner, with the Housing Minister confirming “this Government is committed to building Starter Homes to help young first time buyers get on the housing ladder”.
So it seems positive steps are already being taken to kick-start housing production in 2017 by the new Government administration albeit confined in this particular policy to home ownership.
Which areas have been selected so far?
In its announcement, the Government has confirmed the following 30 areas are included within the initial roll-out of the Starter Homes provision:
- Blackburn with Darwen Council
- Blackpool Council
- Bristol City Council
- Central Bedfordshire Council
- Cheshire West and Chester Council
- Chesterfield Borough Council
- Chichester District Council
- City of Lincoln
- Ebbsfleet Development Corporation
- Fareham Borough Council
- Gloucester City Council
- Greater Manchester Combined Authority ( which includes Bolton, Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside, Trafford, Wigan)
- Lincolnshire County Council
- Liverpool City Council (in association with Sefton, Knowsley, Halton, Wirral and St Helens)
- Luton Borough Council
- Mid Sussex District Council
- Middlesbrough Council
- North Somerset Council
- Northumberland County Council
- Pendle Borough Council
- Plymouth City Council
- Rotherham Metropolitan Council
- Rushmoor Borough Council
- Sheffield City Council
- South Kestevan District Council
- South Ribble Borough Council ( in association with Preston City Council and Lancashire County Council)
- South Somerset District Council
- Stoke-on-Trent City Council
- West Somerset Council (in association with Taunton Deane Borough Council and Sedgemoor District Council)
- Worthing Council
In its press release, the Government confirmed these local authority partnerships have been selected on the ‘basis of their potential for early delivery of the schemes’ as initial sales are expected to take place in 2018.
These partnerships have been established under the £1.2 billion Starter Homes Land Fund which was launched in March 2016 to provide local authorities with the necessary funding to prepare brownfield sites for the development of thousands of Starter Homes by 2020.
What could this mean for the housing sector in 2017?
Although there was no suggestion of a shift in the definition of Starter Homes to include other schemes such as Rent to Buy which had been anticipated due to Mr Barwell’s previous comments, the Government was keen to proffer the broader benefits of the scheme and confirmed the ‘new developments will also support the wider growth and regeneration of local area, including some town centre sites, and help make sure this is a country that works for everyone’.
Gavin Barwell said during his announcement, in relation to the uptake of Starter Homes, ‘this first wave of partnerships shows strong local interest to build thousands of Starter Homes on hundreds of brownfield sites in the coming years. One in three councils has expressed an interest to work with us so far’. A positive sign indeed given some previous reservations the sector had in relation this scheme.
The sector’s reaction to this latest announcement has been mixed, with one sector commentator stating ‘it is good that the Government is working closely with councils to build more homes’ whereas another is of the opinion that the ‘new year green light for Starter Homes raises yet more questions about the flagship Conservative policy…and the chances of building 200,000 Starter Homes at a 20% discount by 2020 look somewhere between slim and zero’.
Certainly the sector will be looking at this as only one element in the Government’s overall housing policy and we look forward to the publication of the Housing White Paper which will outline the Government’s future plans for the building of further new homes.
We must also not forget the encouraging comments made previously by the Housing Minister championing the provision of all types of tenure to tackle the housing crisis and we await further announcements in this respect during the course of 2017.
If you have any questions on the above and how it will affect social housing providers, or any other questions as a social housing provider, please do not hesitate to contact John Murray or a member of our expert Social Housing Team.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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