Investing in council housing
The government’s aim to build one million new homes over the next five years is ambitious, and requires investment. Our survey confirms that authorities with housing stock envisage challenges from the reduction in rental income which can be seen in reforecast business plans and warnings over financial stability.
The government’s aim to build one million new homes over the next five years is ambitious. In the aftermath of the EU referendum, with doubts about future investment in construction and about developers’ willingness to commit to building new homes, the aim becomes even more challenging.
If one million extra homes are to be built, all providers – private developers, housing associations and local authorities – will need to contribute. Until 2012, council housing finance was controlled by government, but calls for reform led to a new settlement in April 2012, ‘intended to endure for the long term.’ The majority of councils took on £13bn in extra debt in order to become ‘self-financing’ and to invest more in new homes.
As the two professional bodies most concerned with housing management and housing finance in the social sector, CIH and CIPFA decided to work together to explore the current situation and what could be done to allow local authorities to play their full role in contributing to the target of one million extra homes. What has happened since 2012?
This Insight is the result.