Associations to scale up affordable rent after flexibility announcement

In the Autumn Statement chancellor Philip Hammond announced ?1.4bn in funding for 40,000 homes and flexibility around the additional, previously announced, ?4.7bn in the Shared Ownership and Affordable Homes Programme to 2021. This means providers can use government grant to build affordable rented, shared ownership and rent-to-buy homes.

The programme, launched by George Osborne at last year?s Autumn Statement, had controversially contained no cash for sub-market rent with the vast majority directed to ownership.

David Bennett, chief executive of Sanctuary, said: ?With today?s government announcement we will be able to build even more social housing.?

Keith Exford, chief executive of Affinity Sutton which is shortly to merge with Circle, said he is ?really keen? to build more affordable rented homes and welcomed the flexibility over the funding.

The policy U-turn follows extensive sector lobbying, after housing associations submitted reduced bids due to fears over the viability of building only for shared ownership.

In a statement that put housing funding at its centre, Mr Hammond also announced a ?2.3bn Housing Infrastructure Fund that aims to provide the infrastructure around 100,000 new homes targeted at the most in-demand areas.

Ann Santry, chief executive of the newly merged Sovereign, said tackling infrastructure issues could help unlock thousands of homes in her area.

Paul Tennant, chief executive of Orbit Homes, said the government had listened to the sector in its call for funding flexbility. He added this ?reinforced? that the Right to Buy deal ?has given us access to government which we wouldn?t have had otherwise so it?s been a longer-term strategy?.

He added ?1.4bn is not enough to tackle the scale of the housing challenge but it is ?certainly a useful investment?.

David Montague, chief executive of L&Q, said the funding flexibility allows housing associations to charge a ?genuinely affordable? rent ?and as housing charities that?s exactly what we choose to do?. He added the funding flexibility could allow L&Q to ?move towards the 50% affordable housing target in London sooner than we might have otherwise been able to do?.

A Treasury spokesperson said the new flexibilities in the Affordable Homes Programme would not include social rented housing but it is not yet clear if housing associations will have the flexibility to set their own affordable rents.