The governments said it is considering two options - firstly requiring that a fixed proportion of units in new schemes on "suitable sites" would have to be discounted homes for first-time buyers; secondly, delivering such housing via section 106 developer contributions.
Cllr David Renard, housing spokesman at the Local Government Association, said: "Councils support measures to enable home ownership. It is important that this does not come at the expense of providing truly affordable homes for rent. Not everybody is ready to buy and we will be making the case in this consultation that local areas will need discretion on the number of First Homes required in new developments. This will allow councils to ensure a mix of homes – to rent and buy – are available and affordable to people that need them.
Rico Wojtulewicz, head of housing and planning at the House Builders Association, which represents small- to medium-sized builders, said: "The ‘First Homes’ consultation is an opportunity for the government to reform some of its housing approaches. Many English regions already deliver affordable homes, therefore the scheme may be more suited to unaffordable regions. The government may seek to reform planning contributions because CIL, which was meant to replace section 106, is still not implemented nationwide. And it may like to define and exempt medium sized sites too, as they have now been included in the National Planning Policy Framework."
Kate Henderson, chief executive of housing association umbrella group the National Housing Federation, said: "We are concerned that this proposal could make it more difficult for housing associations and councils to provide homes for lower income families. We support efforts to increase home ownership, but not at the expense of building homes for those most in need. At present, almost half of new affordable homes come through the planning system. If this proposal goes ahead, we will need to see a significant increase in government funding for genuinely affordable housing - this is the only way we will end homelessness and provide the homes local areas need."
Gavin Smart, chief executive of the Chartered Institute of Housing, the professional body for housing professionals, said: "We understand that the government is keen to support households to access home ownership; this is an ambition we support. But it must not be at the expense of providing much needed affordable rented homes for households with lower incomes. The planning system is currently a major mechanism for delivering new affordable homes for rent. If these proposals are implemented, the government must put in place alternative mechanisms and funding to support the continued provision of the affordable rented homes that are needed across the county."