The 2015 Budget saw Chancellor George Osborne announce several proposals with the intention to catalyse growth throughout the UK’s housing market.
As previously discussed in our blog last week, one of the proposed policies was a new Help to Buy Isa, an initiative that would provide a step up for first-time buyers saving towards a deposit.
However, as the scheme could create additional appetite for property, concerns emerged that there would not be a sufficient supply of homes to cater for a rise in demand. One announcement made in the Budget did however aim to address an undersupply, with the proposal of 20 new housing zones across the nation.
Defined as an area of land granted government funding to unlock infrastructure, site acquisition and leaseholder buyouts, the housing zones would see both a developer and local authority commit to delivering a certain calibre of affordable, private housing. As a further condition to a housing zone agreement, these developments must be delivered on deadline.
According to the Treasury, the 20 housing zones would create 45,000 new homes, delivering 34,000 initially with a further eight ‘potential zones’ in the pipeline to create an additional 11,000 properties. Within the designated zones, planning rules would be relaxed and deals brokered with developers in order to accelerate the construction process, in a bid to ‘keep Britain building,’ as stated by the Chancellor.
The proposed number of properties in this year’s Budget is double the amount offered in June 2014. Of the areas appointed for the new scheme, the south of England will benefit from the largest share of the properties, with a third due to be constructed in the region. 20% of new homes have been allocated for Yorkshire, 20% for the Midlands and 12% in the North West, whereas the West will receive 10% of the newbuilds, and the North East just 2%.
Although the capital does not qualify for one of the 20 proposed housing zones, London could benefit from an additional £1 million in funding for the next financial year, to be granted towards the new London Land Commission. Unveiled in February 2015, the Commission has been established to redevelop derelict public sector brownfield land in order to create 400,000 new homes in the city by 2025.
The consideration of greater access onto the UK property market for consumer Britain is high on 2015’s political agenda. We welcome the pre-election policy framework around what is an issue of paramount importance. Accelerating housing led, economic growth and regeneration of the UK, particularly in the capital is something we are exceedingly passionate about at Strawberry Star. The creation of new homes does not only cater for the ever-growing UK population searching for somewhere to live, but redeveloping previously disused or overlooked areas can inject a new lease of life into markets once on the fringe, paving the wave for a new generation of home owners and communities as a result.
To find out more about our operations in London’s up and coming markets, visit the Strawberry Star