Government to commission smaller property developers

David Cameron is due to announce the government’s latest plan to “directly commission” the building of up to 13,000 new affordable homes.

In a bid to kick-start house building in the UK, the government is to commission small and medium-sized property developers to build on publicly-owned land.

Prime Minister David Cameron said the “radical” announcement shows a “huge shift in government policy” and claims that this latest plan represents the largest such intervention since Margaret Thatcher’s redevelopment of London’s Docklands.

Instead of relying on large building firms, direct government commissioning will allow the government to assume responsibility for developing land itself.

The Government, however, will not own the homes; they will be sold off by developers.

The new year will see up to 13,000 homes being built on five publicly-owned sites, 40% of which will be affordable “starter” homes, Downing Street said.

Its aim is to build 200,000 starter homes by 2020, which will be offered at a discount of at least 20% to buyers under 40 years of age.

A pilot for the scheme will start on five sites:

  • Brownfield land at Old Oak Common, in north-west London

  • Former Connaught Barracks, in Dover

  • Ex-MoD land at Northstowe, in Cambridgeshire

  • Former hospital site at Lower Graylingwell, in Chichester

  • MoD site at Daedelus Waterfront, in Gosport

A £1.2bn fund to build 30,000 affordable starter homes on underused brownfield land in the next five years is also due to be announced by the government.

Communities Secretary, Greg Clark, said:

“Today’s radical new approach will mean the Government will directly commission small and up-and-coming companies to build thousands of new homes on sites right across the country.”

“Currently the top eight house builders provide 50 per cent of new homes. The direct commissioning approach will support smaller builders and new entrants who are ready to build but lack the resources and access to land.”

"This, and the £1.2bn new Starter Homes Fund, will help thousands of people to realise their dream of owning their own home,"

he added.

But Labour’s shadow housing minister, John Healey, has been quick to point out that home ownership is at its “lowest level in a generation”.

"In the Autumn Statement a few weeks ago, George Osborne tried to spin his halving of public housing investment as an increase. Now David Cameron is laying on the rhetoric to hide his failure on new homes,"

Healey said.

"Today's statement promises no new starter homes beyond those already announced,"

he added.

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