COMMENT – FUTURE PROGRAMME CERTAINTY NEEDED TO HELP US BUILD MORE HOMES

JV NorthGovernment, Home building, Homes England, Investment, SOAHP 2016/21

JV North Chairman and Chief Executive at Weaver Vale Housing Trust, Wayne Gales, explains why future programme certainty will help the sector build more homes.

It is rare in the world of housing development for money not to be the main issue in question from which everything else stems.

For developing landlords including JV North – a consortium of housing associations who came together in 2007 to build more – it is future certainty beyond the current 2016/21 Shared Ownership Affordable Housing Programme that is most keenly craved.

While financial matters are always a going concern, we know funding and commitment exists from the Government to help us build homes.

Last year housing moved significantly up the political agenda, the Prime Minister declared she is backing the sector and new funding vehicles like Strategic Partnerships were announced.

What we need now, then, more than anything else is confirmation about the next Government-funded development programme beyond 2021.

While April 2021 seems some way off, from a development perspective it is actually a very small window in which to operate and it’s starting to prove restrictive.

At JV North, we ramped up our home building from c3,000 homes at the start of 2016 programme to what will be over 4,760 by 2021 but have now hit a very real problem caused by the programme end date and no knowledge of what may follow.

We are seeing bigger schemes stalling for no other reason than they can take three years or more to complete which means they fall outside of the 2016/21 programme deadline.

One JV North member has a 150-home scheme that would make a big difference to the housing shortage in its area but there is not enough time for it to be built out in the 2016/21 programme.

This is very frustrating and is an anomaly of the system – grant funding is secured, our members have committed money to invest, land is identified and there is no shortage of determination.

We wrote towards the end of last year about JV North delivering homes in their thousands for the past 12 years with funding coming from affordable homes programmes and continuous market engagement.

While the 23 housing associations named as Strategic Partners have funding and a longer period in which to operate [start on-site by March 2022] the vast majority of the country’s developing housing associations face a ‘ticking clock’.

The implications of schemes being halted should not be underestimated especially when multiplied on a national level.

The 2008/09 credit crunch saw a lot of experienced people leave the construction and housing sectors with builders in particular still facing serious challenges to find enough high quality trades people to deliver schemes.

It is vital we do not lose capacity in the system again. Any slow down or stagnation is very dangerous with potential long-term implications.

JV North has taken some steps to counter this risk by supporting SME contractors through a specialist lot on our framework for schemes £1m-and-under with a pool of 51 [and growing] local companies to select from.

This, along with a lot for schemes over £1 million featuring some of the biggest contractors and consultants in the UK, means we are set up to get on-site and deliver very quickly.

Everything is in place so maintaining the right environment for us to build is therefore critical.

While these problems are serious and concerning, a positive Government announcement about a new programme that takes grant funded development into the mid-to-late 2020s would alleviate a lot of the worries and frustrations facing many developing landlords.

Crucially, it would provide the confidence and continuity we and the construction industry needs to maintain momentum and meet the acute demand for good quality homes across the country.