Government investment in the private market ‘dwarfs’ support for affordable housing, according to a housing think tank.
New analysis from the Chartered Institute of Housing (CIH) has revealed Whitehall is due to spend £32bn - or 79% of its housing budget - on programmes such as help to buy up to 2020/21.
This far outweighs the £8bn - 21% of the budget - it will spend on programmes such as shared ownership and affordable homes.
The CIH’s UK Housing Review briefing analysed data provided by the Department for Communities and Local Government (DCLG) and also found the number of affordable homes funded by the Government had decreased dramatically.
According to its calculations, between 2010/11 and 2016/17 Whitehall-backed affordable housing dropped from 56,000 to 28,000 - a decrease of 50% since 2010.
At the same time, the number of homes for the cheapest social rents built using Government finance fell from 36,000 to just over 1,000. These tend to be around 30-40% cheaper than market rent.
The CIH urged the Government to shift spending towards genuinely affordable homes to help people on lower incomes rather than spending the housing budget on homes for ‘affordable rent’, which can be up to 80% of market rents.
‘People on lower incomes are finding it increasingly difficult to make ends meet as they experience the impact of stagnant wages, rising inflation and welfare reform cuts,’ said CIH’s chief executive, Terrie Alafat.
‘These factors and the shift towards “affordable rent” all mean that housing is becoming increasingly unaffordable in many parts of the country.’
‘We know we need to build more homes to get to grips with our national housing crisis – our UK Housing Review briefing highlights that annual supply remains at least 30,000 homes short of household growth,’ Ms Alafat continued.
‘But it’s not just about building more homes; it’s about building more affordable homes for people on lower incomes. The Government needs to take an urgent look at rebalancing the housing budget and investing more in genuinely affordable homes for rent.’
