The Government has committed to spend a total of £4.5bn to stimulate the building of 150,000 homes over the next four years – £2.3bn is already allocated to meet existing project plans.

Homes and Communities Agency chiefs have published a step-by-step guide for providers who wish to apply, working alongside local authority partners.

It is hoped the scheme will draw traditional house builders and housing associations to consider building homes as well as smaller developers looking to expand into housebuilding.

Under the plans landlords will be able to offer homes to tenants on fixed tenancies charging a rent of up to 80% of local market rates. The extra revenue raised from rents is then expected to be invested in building new homes.

Housing associations will need to set out their proposals for the four-year programme covering how they intend to manage existing assets and “generate significant volumes of new supply”.

These proposals will form the basis of a framework contract agreed between the provider and the HCA covering the period 2011-15.

Pat Ritchie, chief executive of the HCA, said: “This new approach gives increased flexibilities for local authorities and providers to plan ahead and deliver  much needed affordable homes.

“At a time when funding is tight, this new way of operating will allow us to do more with less resources, but it will rely heavily on effective working partnerships, which is where the HCA will play a significant part.”

Housing Minister Grant Shapps said: “With some 4.5m people on social housing waiting lists, it’s clear that not only do we need more homes, but we also need a complete overhaul of the system, to one that offers much more flexibility than the current ‘one size fits all’ approach.

Additionally, the document outlines how the HCA will assess the bids, and how programme management will operate under the model. It explains the role of the social housing regulator, currently the TSA, and details arrangements for London, where the HCA’s powers are proposed to transfer to the Mayor in April 2012. A timetable for the programme is included.

Registered Providers will have until 3 May to submit their proposals to the HCA, after which point all offers will be assessed. It is anticipated that initial contracts will be ready in July.

The framework is available to download from the HCA website at
www.homesandcommunities.co.uk/affordable-homes