The National Audit
Office (NAO) reports that despite the government announcing in 2015 that it
intended to create 200,000 Starter Homes, no Starter Homes have been built to
date as the necessary legislation is not in place.
Between 2015-16 and
2017-18, the Ministry of Housing, Communities & Local Government (MHCLG)
spent almost £174 million on acquiring and preparing sites originally intended
for building Starter Homes. These sites are now being used for housing more generally,
some of which is affordable housing.
Starter Homes were
intended to be houses built exclusively for first-time buyers under the age of
40 and sold at a 20% discount. The November 2015 Spending Review provided £2.3
billion to support the creation of 60,000 Starter Homes.
The Housing and
Planning Act (2016) set out the legislative framework for Starter Homes.
However, without additional secondary legislation, even houses that conform to
the intended Starter Home specifications cannot be marketed as Starter Homes.
MHCLG expected to introduce the secondary legislation and planning guidance
required for Starter Homes in 2019 but it has not yet presented the regulations
to Parliament. It no longer has a budget dedicated to the delivery of Starter
Homes.
The NAO report
includes more information on the status of Starter Homes policy and legislation
and the impact of MHCLG’s investment.
Meg Hillier, the
chair of the public accounts committee, said: “Despite setting aside over £2bn
to build 60,000 new starter homes, none were built.
“Since 2010 many
housing programmes announced with much fanfare have fallen away, with money
then recycled into the next announcement.
“The department
needs to focus on delivery and not raise, and then dash, people’s
expectations."
Richard Beresford,
chief executive of the National Federation of Builders (NFB) said: “We worked
hard with the Government to make them understand how important this policy was
to small builders and communities. They’ve not only pulled the rug from under small
builders, including many hard-working NFB members, but also from under
thousands of homebuyers who would have benefited from this policy.”
Priced at no more than
£250,000 outside London and £450,000 inside the capital, the only criteria for
eligibility was to be a first time buyer and under 40 years old. The scheme was
meant to deliver on brownfield sites, a specialty of small builders, and
deliver much needed planning certainty.
Rico Wojtulewicz, head
of housing and planning policy at the House Builders Association, said: “Only
last week we tried to make contact with Homes England about starter homes and
we now know why we didn’t get a response. The Government has failed to deliver
on a key promise that industry had planned for. They must either deliver or
kill this policy - or they risk further damaging small and medium sized
builders.”
