The Autumn Statement revealed five key themes for the social housing sector and while uncertainty inevitably remains, registered providers (RPs) must take advantage of the potential opportunities.
A critical role for housing
Housing was shifted up the priority list in Philip Hammond’s first Autumn Statement. Although this is in part driven by Brexit and a need to strengthen our economy, this welcome change of approach from Westminster shows that the housing sector has finally been listened to rather than ignored.
Housing and economic infrastructure should go hand in hand
Mr Hammond made clear that housing should be recognised as a fundamental driver of national productivity. This was evidenced by the Northern Powerhouse Investment Fund (NPIF) and two major allocations – £2.3bn towards infrastructure to support new housing and £1.7bn to speed up housebuilding on public sector land through partnerships with the private sector.
Reining in of Housing and Planning Act 2016 provisions
The Housing and Planning Act, which is perceived by many to be an attack on housing associations, has been given a low profile. The Voluntary Right to Buy has been delayed for at least a year, compulsory Pay to Stay has been axed and the Starter Homes programme put on the backburner. There’s also been little word of the Local Authority levy on higher value properties.
These provisions were seen as an attempt by Cameron’s Government to control the housing sector. Reigning them in is a positive sign that Theresa May’s administration will be more of an ally.
Dilution of home ownership
It was just over 12 months ago that Cameron vowed to create Generation Buy, but this home ownership drive has now been diluted. This was underlined by a commitment for a further £1.4bn of capital towards affordable housing.
A spotlight on regional growth is evident with £1.8bn allocated to LEPs with an emphasis on funding local infrastructure as a catalyst for housing delivery.
The National Infrastructure Commission’s delivery models of housing as proposed in the Cambridge-MK-Oxford corridor have been welcomed and a £3.15bn investment will support 90,000 new affordable homes in the capital.
As well as the NPIF, the Government has shown an ongoing commitment to devolution and will also consult with local authorities regarding preferential interest rate support for high value for money (VFM) infrastructure projects.
For those operating in the social housing sector, these themes should give them confidence. Many RPs are keen to get on with building and our new Government is paving the way for them to do that with a renewed focus on delivery.
Although there are still some constraints and challenges linked to planning, resourcing and funding, there are many opportunities too. As well as deregulation, there is an appetite for new joint ventures, partnerships and models that will help boost supply. And although in some instances mergers could be seen as a distraction, if successful they hold the key to building at scale.
There’s no denying that there are still many unanswered questions, but RPs have got used to working in an uncertain and unpredictable environment. Now is the time for them to take advantage of new investment opportunities and our government’s more open minded approach to the sector.
Nick Billingham is a Partner at Devonshires and is speaking about the Autumn Statement and opportunities for RPs at the Big Housing Debate in Manchester on 6 December 2016.