Government to build more affordable homes

The UK government has announced a £3 billion increase in funding for the Affordable Homes Scheme, aimed at facilitating the construction of 20,000 new affordable homes across the country. This expansion of the scheme, which provides low-cost loans to housing providers, will not only support the development of new homes but also enable upgrades to existing properties, including essential building safety works such as the removal of dangerous cladding.

Managed by the Department for Levelling Up, Housing and Communities, the Affordable Homes Scheme now boasts a total fund of £6 billion, allowing housing providers to access affordable loans to expand their operations, construct affordable housing, and improve the quality of existing housing stock.

Housing Minister Lee Rowley emphasized the importance of affordable loans in overcoming obstacles faced by developers in building new homes or upgrading existing ones to meet the standards expected by tenants. He highlighted the positive impact of the scheme in improving the quality of housing and providing affordable options for families across the country.

Since its launch in 2020, the scheme, administered by ARA Venn, has already supported 12 providers in delivering over 6,290 new homes, with many more in the pipeline. One of the beneficiaries, Watford Community Housing, has used the scheme to build 200 new homes and is set to build an additional 100 affordable homes with a second funding application.

ARA Venn’s Portfolio Manager, Richard Green, expressed delight at the scheme’s expansion, which now includes support for investment in existing homes alongside new developments. He highlighted the success of the Affordable Homes Guarantee Scheme as a vital funding source for the housing sector.

The government remains committed to its manifesto pledge to build 1 million homes during this Parliament, with a target of delivering 300,000 homes annually. This effort is supported by significant investments totaling £10 billion to boost housing supply, as well as the £11.5 billion affordable homes programme, which is expected to unlock £38 billion in additional private investment.

The announcement can be seen here.

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