Three million homes by 2020 target under threat unless councils and private sector investors step in, says report

A new report, Delivering Urban Homes, reveals that the Government’s target of three million homes by 2020 is under threat – unless councils and private sector investors take a front seat in building and managing these new homes.

Today’s inquiry report from the All Party Urban Development Group finds that councils need extra support from Whitehall – and especially from the newly created Homes and Communities Agency (HCA) – to deliver the additional homes needed in their areas.

This support would help local authorities solve the very specific housing dilemmas they face.  Large parts of the south east are grappling with the challenges of demand and affordability.  And some parts of the north are struggling to regenerate communities to create both market rate and affordable housing.

The group warns that the HCA must avoid the temptation to nationalise housing policy and actually work with local councils to address the different needs of housing markets.  Instead, the group recommends that the HCA should act as a ringmaster – bringing skills and investment from the public and private sector together, and providing expertise to councils that need extra technical support.

The group also finds that private sector landlords will have a vital role to play in delivering more homes across England. But individual buy-to-let properties won’t make up the shortfall.  The Government needs to do more to encourage long term, professional institutional investors. Common in the US, Germany and Switzerland, these investors are well placed to build and manage large quantities of affordable, good quality homes, which people actually choose to rent, rather than buy.

Clive Betts MP, Chair of the All Party Urban Development Group said: 'It’s time to move beyond national housing targets.  We urgently need to get to grips with the practical difficulties of building three million new homes.  Local authorities must play a key role in delivering homes, and they need help to deliver the goods.

'The HCA is in a strong position to bring housing expertise under one roof and give specialist advice to local authorities.  However, more needs to be done to attract long term professional institutional investors into the private rented sector.  Otherwise the number of homes will fall considerably short of the mark.'

Eamonn Boylan, Deputy Chief Executive of Manchester City Council (Regeneration) and inquiry witness, commented: 'The work of the group has served to highlight the real opportunity for the new Homes and Communities Agency to work with Local Authorities to deliver sustainable growth and regeneration and to support the economic and urban renaissance of our towns and major cities.'

Mark Ryder, Chief Executive of Isis Waterside Regeneration and inquiry witness said: 'This report is timely as the market correction that began at the end of last year offers an opportunity to take stock of how urban regeneration has been delivered and should encourage the development industry to raise its game.'

'There can be no quick fix to sustainable urban regeneration and the report underlines the importance of long term solutions to the future of city living based around better use of public sector land, placemaking, the fostering of communities and delivery models that are not reliant on short annual profit horizons.'