The Homes & Communities Agency launched its grant bidding framework in early February, setting out how affordable housing will be funded over the next four years.
£2.2bn will be made available to develop new homes, representing a dramatic reduction in available grant. Most new homes will have to be let at 80% of market rent under the new affordable rent rules and housing associations will be expected to make flexible use of their assets to subsidise new developments. Grant will be limited to the minimum necessary to make developments viable.
Concerns have been expressed that supported housing, targeted specifically at the most vulnerable in society, may not be affordable at 80% of market rents. This could mean a reduced supply of new homes for people with a learning disability at a time when demand is increasing.
Supported housing is undoubtedly more expensive to build than ordinary housing and often requires a higher rate of subsidy. Typically, in recent years, grant levels of £50k + per unit have been required to make schemes viable. Grant levels over the next four years are likely to drop to between £10k and £15k per unit. The question is: will the new increased rents produce enough capital to make up for the loss of grant subsidy? In some areas it clearly won’t, requiring additional subsidy from elsewhere. With council budgets under severe pressure, it’s pretty unlikely that many local authorities will be able to make capital contributions to schemes.
Housing Associations will continue to offer shared ownership products in the future and rather surprisingly, the HOLD scheme grant remains intact. The HOLD scheme allocates grant to select housing association to help them develop shared ownership homes for people with long-term disabilities. Good news, you might think. However, most disabled people who use this scheme rely on mortgages to pay for their share in a property. At the moment disabled people who rely on welfare benefits for their income, can’t get a mortgage because the Coalition Government slashed the benefit that helps them with their mortgage payments in half.
Buy to Help produces financially viable ordinary housing opportunities for people with learning disabilities and does not rely on government grant subsidy. And that’s why our initiative is so important. If you’d like to help us make a difference to people with learning disabilities, please pledge your support here »
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