Osborne spurs house builders to deliver 400,000 homes

Aaron Morby 5 years ago
Share

Chancellor George Osborne attempted to galvanise reluctant house builders into delivering more homes with a £6.9bn package of measures.

Critically the affordable housing package in the combined Autumn Statement and Spending Review includes cash to stimulate the supply-side and demand-side of the housing sector.

He also said transport capital spending would be raised to fund HS2 and the roads programme as the department’s operational budget was slashed by 37% but its capital spending will increase as previously planned by 50% to £61bn, compared to the last five-year period.

“That funds the largest road investment programme since the 1970s, for we are the builders,” added Osborne.

The funding includes starting construction on High Speed 2, and sticking to plans to spend £13.4bn on the Roads Investment Strategy to deliver 112 major schemes and over £5bn on roads maintenance.

Up to £475m will be released towards the end of five years to fund large local transport projects, enabling local areas to bid for funding for projects that would be too expensive for them to pay for by themselves, such as the Lowestoft Third River Crossing and the North Devon Link Road.

The Government has ramped up spending on the school estate and committed to spend £23bn over the Parliament to open 500 free schools, provide over 600,000 additional school places, rebuild and refurbish over 500 schools and address essential maintenance needs.

Spending Review other key points

  • New £300m Transport Development Fund, supporting development work for projects like Crossrail 2
  • Apprenticeship levy will be set at 0.5% of an employers wage bill
  • £1.3bn to reform prison estate by building nine prisons
  • £310m for 15,000 homes at Ebbsfleet garden city
  • £400m to build new integrated public health science hub in Harlow
  • Creation of 25 enterprise zones
  • Council free to raise business rate to fund infrastructure and spend all capital receipts from asset sales
  • £150m for a new dementia research institute at a UK university site
  • £150m to build new storage facility for the British Museum, Science Museum and Victoria and Albert Museum
  • £97m Thameslink station at Brent Cross
  • Extra £250m for Kent transport
  • Fund new home for Royal College of Arts in Battersea
Infrastructure investment £billion
Year 15-16 16-17 17-18 18-19 19-20 20-21 Total
Existing long term capital plans
Roads Investment Strategy 1.8 1.8 2.2 2.5 3.0 3.9 15.2
Highways maintenance 1.0 1.0 1.0 1.0 1.0 1.0 6.9
Network Rail 6.8 7.4 5.6 4.3 5.0 5.3 34.5
High Speed 0.8 0.8 1.7 2.9 4.8 4.8 15.8
Flood/coastal defence 0.4 0.4 0.4 0.4 0.4 0.4 2.3
Science: capital 1.1 1.1 1.1 1.2 1.2 1.2 6.9
Housing and regen plans 1.0 1.0 1.0 1.0 1.0 1.0 5.9
Existing school building plans 4.6 4.8 3.8 3.2 3.0 2.8 22.2
New extra spend
Housing and regeneration 0.0 0.3 1.2 1.1 1.4 4.1
Local Sustainable Transport Fund 0.1 0.1 0.1 0.1 0.1 0.5
Large Local Major Roads 0.0 0.0 0.0 0.1 0.3 0.5
New school building plans 0.3 0.8 1.3 1.5 1.8 5.7
Total spend 17.5 18.7 18.0 19.1 22.1 23.9 120.4

 

On housing he added: “First I am doubling the housing budget to £2bn a year and will deliver 400,000 new homes by the end of the decade. That is the biggest house building programme since the 70’s.”

Full details have still to emerge but the spending package includes direct subsidies of up to £2.3bn to developers to spur them into building 200,000 starter homes — properties for sale to first-time buyers at a 20% discount to their market value.

The new starter homes discount policy first announced in October 2014 will be available on prices up to £450,000 in London and £250,000 elsewhere.

On the demand-side up to £4bn will be channeled into building 135,000 Help to Buy: Shared Ownership homes for households earning less than £80,000.

In London, this threshold will stand at £90,000. The Chancellor also launched the London Help to Buy scheme, which will provide interest free loans on up to 40% of loans.

A further £400m is earmarked to help build 8,000 specialist homes for older people or those with disabilities.

Up to £200m has been found for 10,000 new homes that tenants can live in for five years at reduced rents while they save for a deposit. They will then have “first right” to buy the home. 

 

 

Latest news

Construction output surge sees cost inflation hit record high

Buyers report rises in input costs hit near 25-year high as materials shortages bite
8 hours ago

Fire at tower days before Grenfell-style cladding due to be removed

More than 40 people injured during blaze at 19-storey building
4 hours ago

Firms shortlisted for £140m Havant reservoir

Balfour, Hochtief and Mackley/Jones JV hunt main reservoir package
11 hours ago

Blackstone makes £1.2bn bid for St Modwen

Investment giant set to acquire big name developer
11 hours ago

London Chalcots towers £100m reclad out to bid again

Camden Council hopes to let Swiss Cottage estate reclad before the end of this year
1 day ago

Balfour facing strike ballot over “insulting” pay offer

Industrial action ballot planned for workers on £1.5bn Central Rail System Alliance contract
1 day ago

Hill wins 142-home McArthurs Yard job in Bristol

Housing contractor bags first Bristol job at harbourside site
1 day ago

BarhaleDoosan to build organic waste water treatment works

Natural integrated wetland to be built at Clifton wastewater treatment works
10 hours ago

London Nine Elms 12-storey office approved

Construction to start this summer at former Royal Mail site
11 hours ago

Fresh price hike takes structural steel to £800 per tonne

Seventh price hike since last July sees steel sections rise by £50/t
1 day ago

Barratt problem concrete frames and cladding bill hits £163m

House builder sees demand and construction surge but legacy property charges rise
1 day ago

Materials shortages threatening pace of rebound

RICS survey reveals confidence running high but shortages could put brakes on recovery
2 days ago

Henry Boot rejigs senior management

New MDs appointed to head construction and plant operations
1 day ago

Procure Plus plans £1.3bn low carbon housing framework

Firms wanted to supply or fit solar panels and air and ground source heat pumps
1 day ago

Keltbray sells electrical engineering arm to management

MBO at Keltbray Lagan Power three years after contractor acquired majority stake in business
2 days ago

BAM awards £150m worth of Manchester arena packages

North West subcontractors win top billing at Co-op Live project
2 days ago

Contractor Kilnbridge sold to 800-staff ownership trust

Founder of £90m East London contractor sells to workforce trust
2 days ago

ISG chalks up £48m haul of school wins

Deals include a £12m pathfinder 'net zero' school in Bristol
2 days ago

Green light for £37m Dawlish train rockfall shelter

Work to start on 209m long track protection structure this August
2 days ago

Keltbray posts £9.4m loss due to Covid and restructuring

Specialist contractor confident about future with £25m net cash and £224m order book
3 days ago

Construction start date for £200m Basildon scheme

Work to start this autumn on Essex site being developed by Inland Homes and Homes England
2 days ago

New Buro Happold chief to double staff in six years

James Bruce aims rapidly to grow engineering consultant into a global player
3 days ago

Atkins raids Skanska for new finance director

Jo Jarman returns to consultant as new finance director
3 days ago

Kier wins £15m Braintree enterprise centre

Building work at Great Notley to start later this month
3 days ago

Big name concrete firms miss out on major HS2 deal

Skanska Costain Strabag JV awards major package to Kelly Formwork
3 days ago

Covid shakes-up Top 30 M&E contractors rankings

Several M&E firms grow despite 9% fall in revenue last year among top 30 specialists.
3 days ago

Bylor builds second Hinkley reactor shell a third faster

Next massive prefabricated steel ring section for reactor building lifted in by Big Carl
3 days ago

Plans in for 700-bed Nottingham student scheme

Next phase of The Island Quarter scheme submitted for approval
3 days ago

M Group rebrands Skanska highways arm as Milestone

New business launched as £50m takeover deal signed off
4 days ago

Henry Boot to start £110m Walsall logistics project

Remedial works to start at 620,000 sq ft Phoenix 10 logistics scheme
4 days ago

Contractor services