Housing associations want funds now

The National Housing Federation (NHF) has welcomed the government’s pre-budget report that money for social houses will be brought forward, but called for the funding rules to be changed immediately. The NHF said that unless money is used to pay builders of new social homes higher grant rates, the supply of new affordable housing could dry up next year. HAs currently pay around 60 per cent of the costs of building new social homes through raising cash from private lenders and selling homes on the private market, with government grants covering the remaining 40 per cent. However, the credit crunch has affected badly the ability of the associations to sell on the open market, and the money that the government is bringing forward must be used to pay for increased grants.