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Government plans for 200,000 starter homes 04/03/2015

ARCH Briefing 3/2015

 



Issued by:

DCLG and Prime Minister's Office


Issue date:

2 March 2015


Key Proposals


Reform of planning policy to enable starter homes to be built on under-used or unviable commercial or industrial sites not currently identified for housing, whether privately or publicly owned.


Developers will be exempted from section 106 affordable housing and tariff-style contributions, and from Community Infrastructure Levy (CIL) provided homes are sold to first-time-buyers under 40 at a minimum discount of 20% below market value.


Homes resold or let within 5 years will also have to be offered at 20% below market value.


Revised planning guidance will be published shortly; the Government will seek reform of CIL regulations in the next Parliament.


Background

In December 2015, DCLG consulted on a scheme to provide discounted starter homes on unusable or surplus commercial and industrial land.  At that time the Government estimated that 100,000 starter homes could be provided under this scheme. 


On 2 March, Housing Minister Brandon Lewis announced the outcome of the consultation and confirmed the Government's intention to proceed with the scheme.  On the same day, the Prime Minister made a speech increasing the estimate of the number of homes that could be provided under these arrangements to 200,000 by 2020.  The Government has also issued a press release announcing that aspiring homes owners may register their interest in buying a discounted starter home on a new website.


ARCH Comment

The number of homes provided under this scheme will depend on the number of sites that meet the criteria stipulated in the policy and where the cost of development enables constructed dwellings to be offered at the required discount. The estimate that 200,000 homes can be provided under this scheme is, at this stage, largely speculative.

 

Councils will have the discretion to allow a small proportion of homes to be offered at market value to make schemes viable.  The Government's presumption, however, seems to be that on these sites, homes for discounted purchase will replace other types of affordable housing, such as shared ownership or homes for affordable or social rent.

 

Link to consultation paper

Link to Ministerial statement

Link to press release

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