Report calls for councils to be incentivised to supply housing associations with land

Local authorities should be incentivised to provide more land to enable housing associations to boost the supply of affordable homes, a think-tank report has recommended.

Housing association homes: report calls for sector to do more to boost affordable homes
Housing association homes: report calls for sector to do more to boost affordable homes

The report, by the Policy Exchange think-tank, says housing associations are being stifled by "unnecessary red tape that prevents them from building 100,000 new homes a year – a third of the total housing supply needed to keep up with demand".

The document says that part of the problem is that, at present, England’s 1,500 housing associations are "bound by multiple rules and regulations which prevent them from choosing their own social tenants".

It says these local authority nominations rights lead to a situation where anti-social tenants are effectively "dumped" on housing associations who can do nothing about it and this increases their costs and inhibits them from developing or acquiring new affordable homes.

The report suggests that housing associations should be able to opt out of this system.

It says that these "Free Housing Associations" would be absolved of most local authority nominations rights which would be replaced with local "land for nominations" exchanges.

The report says: "In order for there to be an increase in affordable housing delivery from 45,000 homes a year to 60,000 homes a year, local authorities will need to contribute more land to housing associations for new affordable housing over and above what they are currently providing".

"This should by no means be about punishing local authorities. Local authorities should be further supported and incentivised by central government in providing land to housing associations, perhaps using an enhanced New Homes Bonus mechanism".

The document also says that Free Housing Associations would be exempt from current rules that prevent housing associations from "selling expensive social homes to build new ones on a more than one for one replacement basis, so increasing the number of affordable homes overall".

It says that, if housing associations "could use their balance sheets and asset-manage more freely, they could build an additional 5,000 affordable homes a year, on very conservative assumptions about extra borrowing".

If these and other measures were introduced the document says housing associations could be "free to double the number of new homes built every year from 50,000 to 100,000".

Freeing Housing Associations: Better financing, more homes can be read here.

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