More than £53bn of private investment is expected to be unlocked through the new scheme as part of the Plan for Change
On top of private investment, the National Housing Bank will receive £16bn of public investment to fund new housing.
The bank is a new scheme and a subsidiary of Homes England, is publicly owned, and backed by the £16bn in public investment and £6bn in existing finance from the current Parliament. It is part of the recent spate of support for Homes England.
The National Housing Bank will give Homes England more power
Through the bank, Homes England will be able to issue direct government guarantees, and have more power in making long-term investments to reform the housing market.
This will make the bank a consistent partner in the private sector, and promote stability and certainty for housing developers, including SMEs. New lending products and infrastructure finance will be available through the bank.
These products will include low interest loans, as announced in last week’s spending review, for building social and affordable homes.
The National Housing Bank is also likely to help unlock sites for housing, such as those that are struggling to find up front lending due to risk or complexity, through equity investment, loans, and guarantees.
SMEs will see further support through the bank in more lending alliances with private partners, and increased leverage in capital and expertise such as revolving credit facilities.
“Giving more working people the security of home ownership and investing in Britain’s renewal”
Deputy prime minister and housing secretary, Angela Rayner, said: “We‘re turning the tide on the housing crisis we inherited – whether that’s fixing our broken planning system, investing £39bn to deliver more social and affordable homes, or now creating a National Housing Bank to lever in vital investment.
“This government is delivering reform and investing in Britain’s renewal through our Plan for Change. Our foot is firmly on the accelerator when it comes to making sure a generation is no longer locked out of homeownership – or ensuring children don’t have to grow up in unsuitable temporary accommodation, and instead have the safe and secure home they deserve.”
Chancellor of the exchequer, Rachel Reeves, said: “Our Spending Review last week delivered the biggest cash injection into social and affordable housing in 50 years as we progress on our promise to build 1.5 million homes.
“As part of our Plan for Change, the new National Housing Bank will unlock £53bn of additional private investment—giving more working people the security of home ownership and investing in Britain’s renewal.”
Homes England chair Pat Ritchie said: “Establishing the National Housing Bank, as a part of Homes England, builds on the Agency’s expertise at providing a wide range of finance to partners and places to unlock the delivery of new housing and mixed-use schemes.
“The National Housing Bank also responds to calls from the housing sector, mayors and local leaders to increase the scale of available public and private finance for housing and regeneration, provide a broader range of flexible debt, equity and guarantee products, and enable more timely decision making.”
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