Only 7% of councils in England think the government’s new starter homes scheme will address the need for affordable housing in their area, a new report has revealed.
The data from the Town and Country Planning Association also showed that 80% of local councils do not think that starter homes should be classified as affordable housing.
In the Autumn Statement last year, Chancellor George Osborne pledged to build 200,000 starter homes with 20% discounts for under-40s by the end of the current parliament. The government has earmarked £2.3 billion for private developers, with property values capped at £450,000 in London and £250,000 in the rest of the country.
The TCPA contacted 353 local authorities and got responses from 105 councils, 53% of which are Conservative controlled.
The also survey found that over two-thirds of councils anticipate that they will be building less social and affordable housing as a result of the government’s plans to reduce social rents by 1% a year for the next four years.
Kate Henderson, chief executive of the TCPA, said: “Low cost homeownership, such as starter homes, may help some people get a first step on the housing ladder, but as the survey of council’s highlights this will not address the need for genuinely affordable homes. We need a housing strategy for the nation that provides decent homes for everyone in society, including those most in need in the current housing crisis.
“Our survey has revealed that four out of five councils do not think starter homes should be classified as affordable housing because they are simply not affordable for essential low-paid workers – whose employment underpins an economy on which we all depend – or for many people on average incomes.”
This week, the House of Lords will be debating key measures in the Housing and Planning Bill.
Lobby group Generation Rent has warned that the starter homes policy will help less than 5% of people renting,
This is because after five years first-time buyers using the starter homes scheme to buy a newly-built home at a 20% discount would be able to sell it on at the full market price after five years.
Analysis by Savills had revealed that starter home prices are out of reach for all people in need of affordable homes in 220 council areas and more than 90% in a further 80 council areas.
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