Communities across the country are set to benefit from thousands of new affordable homes under a multi-million pound deal announced by Housing Minister Kris Hopkins.
A total of 13 housing associations will receive a share of £208 million in loans, offered on the best rate ever achieved, to help deliver 4,800 new affordable homes.
- London, where up to 652 new affordable homes will be built
- Sheffield, where up to 138 new affordable homes will be built
- Exeter, where up to 186 new affordable homes will be built
- Bradford, where up to 136 new affordable homes will be built
- Bedfordshire, where up to 264 new affordable homes will be built
The scheme will also extend to Scotland, where 147 homes will be built in Glasgow, and Wales, where 329 affordable homes will be built.
Unlocking funding for affordable house building
The agreement forms part of the Affordable Housing Guarantees Scheme, delivered by Affordable Housing Finance, part of The Housing Finance Corporation.
Through the scheme the government uses its strong economic record to guarantee and unlock up to £3.5 billion of cheaper debt for Affordable Housing Finance, enabling it to lend this on to housing associations to build new homes to rent for families in need.
Today (30 May 2014), Affordable Housing Finance issued its first bond to raise the funding for the schemes, worth £208 million and priced at 3.76% – the lowest priced bond in the affordable housing sector’s history.
A total of 13 housing associations will have access to this new funding. Taken together with around £250 million from an existing European Investment Bank loan also guaranteed by government, these housing associations will deliver around 4,800 new affordable homes.
Housing Minister Kris Hopkins said:
Since 2010 we’ve delivered 170,000 new affordable homes – but we want to go further.
Today’s deal means thousands of new affordable homes will be built in communities from Glasgow to Truro, for families in real need.
And thanks to our hard-won and strong economic record, cutting the record deficit we inherited, these housing associations have access to funding for house building at some of the lowest rates the sector has ever seen.
Delivering thousands of new homes
Since its launch in 2013, 8 housing associations have been approved to receive funding through the Affordable Housing Guarantees Scheme.
Today, Mr Hopkins announced a further 8 housing associations that will receive funds through the scheme – 6 of which are hitting the ground running by receiving funding through this first bond issue.
All 16 are expected to borrow up to £630 million to get over 5,900 additional affordable homes underway by 2017 – with 4,800 of these being delivered thanks to today’s new bond.
The 16 housing associations approved to receive funding through the Affordable Housing Guarantees Scheme to date are:
- Grwp Cynefin
- Homes in Scotland
- Mount Green
- New Gorbals
- Nottingham Community
- Devon and Cornwall Homes*
- First Wessex*
- Great Places*
- Wales and West*
- Home Group*
*already announced on 7 January 2014