Borrowing cap win leads to house building boost

But more needs to be done if local government is to resume its historic role as a major house builder – especially given 205 councils no longer own any housing so cannot use the new borrowing powers.

The LGA’s new survey shows scrapping the cap will support the delivery of local housing, with 94 per cent of housing stock-owning councils saying they will build more homes, and/or build them faster.

However, 92 per cent of councils are clear that more support is needed from government to help them reverse the decline in social housing.

Respondents to the survey want changes to Right to Buy, including the power to retain 100 per cent of receipts and to set discounts locally, while 97 per cent said more national advice and guidance is needed.

The number of homes built for social rent each year has fallen from more than 40,000 in 1997 to 6,000 in 2017, pushing more individuals and families into the often more expensive and less secure private rented sector, and increasing the housing benefit bill.

Cllr Judith Blake, LGA Housing Spokesperson, said: “By lifting the cap on councils being able to borrow to invest in new and existing housing, the Government has showed it has heard our argument that councils must be part of the solution to the chronic housing shortage.

“Our survey shows that councils up and down the country want to build more good-quality, affordable homes that meet the strategic housing needs of their local communities.

“A genuine renaissance in council house building is the only way to boost housing supply, help families struggling to meet housing costs, provide good quality homes to rent, reduce homelessness and tackle the housing waiting lists many councils have.

“Councils now also need to be able to keep 100 per cent of Right to Buy receipts and set discounts locally to ensure they can replace any homes sold.”

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