The percentage of affordable homeownership properties delivered using government grant funding is set to increase under the next Affordable Homes Programme (AHP), the government has confirmed.
The details of the upcoming programme were unveiled by Housing Secretary Robert Jenrick earlier today, where he revealed that 50% of homes delivered under the £12bn programme will be allocated to affordable homeownership.
The new AHP, which is due to run from 2021 to 2026, will allocate the remaining funding to discounted rent – 10% of which is to be reserved for supported housing.
A government representative confirmed that the vast majority of affordable home ownership homes will be for shared ownership and that the split between social and affordable rent will be decided at a local level.
Under the new AHP, £7.5bn in grant funding will be delivered outside London by Homes England – over £2bn more than the amount currently available.
The Greater London Authority (GLA) has been offered £4bn, and the government has said negotiations around what will be delivered with this funding are in progress.
During the March Budget earlier in the year, the government announced that the next AHP programme would comprise £12bn in funding – which includes £700m left over from the current AHP programme.
Today’s announcement marks a rebalancing of government grant funding in favour of affordable homeownership tenures.
The government also confirmed that the vast majority of rented homes delivered through the new programme will be subject to Right to Shared Ownership.
The policy, which gives housing association tenants the right to buy a portion of their property, was announced by housing secretary Robert Jenrick in October last year.
The confirmation comes as the government announces a new model for shared ownership that reduces the minimum initial share in a property from 25% to 10%.
Under the new model, residents will be able to buy additional shares in their homes in 1% instalments, rather than the current 10%.
Landlords will also be required to cover the cost of repairs and maintenance for an initial 10-year period.
Revealing the details of the new AHP programme, Housing Minister Robert Jenrick said: “Today’s announcement represents the highest single funding commitment to affordable housing in a decade and is part of our comprehensive plans to build back better.
“This government is helping hard-working families and prospective first-time buyers get their feet on the housing ladder in an affordable way.
“Thanks to the range of flexible ownership options being made available, more families across the country will be able to realise their dreams of owning their own home, with half of these homes being made available for ownership.”
Nick Walkley, chief executive of Homes England, said: “We welcome the launch of the new affordable homes fund, which gives Homes England a unique opportunity to work on behalf of the government to accelerate the delivery of high-quality, affordable homes.
“The fund will support improved productivity in construction and unlock new economic opportunities across the country.
“Despite the challenges of COVID-19, this long-term funding settlement gives our partners the confidence they need to invest in new homes and the communities they work for.”
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