The National Housing Federation has welcomed the Chancellor’s plans to kick-start the housing market as a ’step in the right direction’ – but warned the measures are not bold enough to tackle the country’s economic or housing crises.

The Federation, which represents England’s housing associations, said that while the Chancellor had identified some of the right issues he had failed to go far enough.

In the run up to the Budget, the Federation called on the Government to implement a house-building programme, which would have seen £6.35bn of public money spent on delivering 100,000 new social homes over the next two years. Such a measure would have provided a shot in the arm to the economy, while also helping to tackle the nation’s growing housing crisis.

Elsewhere, the Federation welcomed a package of government guarantees to boost mortgage lending – but warned it still may not help thousands of people trying to buy shared ownership homes. Meanwhile, it gave a cautious welcome to a £435m programme to improve the energy efficiency of social housing, businesses and public buildings.

Kick-starting the housing market
Commenting on the £1bn plan to kick-start the housing market, Federation chief executive David Orr said:

“The Chancellor has taken a step in the right direction by identifying some clear ways of kick-starting house-building but unfortunately he hasn’t been bold enough.

“The Government is right to take a stake in housing projects where work has stalled and to make it easier for social housing to be built, but ministers needed to go further.

“We are in the midst of major economic and housing crises and the Chancellor should simply have backed our call to spend £6.35bn of public money on helping housing associations deliver 100,000 new social homes over the next two years.

“Under our proposal, billions of pounds would have been pumped into the economy, a quarter of a million people would have been taken off social housing waiting lists and thousands of construction industry jobs would have been saved.

“We now fear that because the Government has failed to back a comprehensive house-building programme the number of homes delivered this financial year will slump to an 88-year-low of 70,000, while the number of people on social housing waiting lists will simply soar to unparalleled levels.”

Assistance to private developers
Commenting on the extra assistance for private developers Mr Orr said:”If the Government is going to come to the rescue of private developers and help them to complete mothballed developments – they must ensure that they have to build significant numbers of social homes.

“Taxpayers cannot simply bail out private businesses without getting anything back to help the wider community.”

Mortgage-backed securities
Commenting on the offer to underwrite new mortgage-backed securities, Mr Orr said: “We welcome moves to increase liquidity in the housing market. Underwriting new mortgage lending has the potential to make a significant contribution to revitalising the mortgage market.

“However, we are disappointed that the Chancellor has failed to compel the nationalised Northern Rock and Bradford & Bingley banks to make mortgages available to the thousands of first time buyers and key workers who are desperate to buy shared ownership homes.

“There are thousands of shared ownership properties lying empty across the country, and thousands of people who want to buy them, but the banks won’t lend on these properties at a competitive rate because they unfairly view them as a higher lending risk.

“This was the Government’s chance to force the nationalised banks to take on a greater social purpose and work in the public’s interest to end this blatant discrimination against people hoping to buy an affordable home.”

Energy efficiency
Commenting on the £435m energy efficiency programme, Mr Orr said: “The Government is moving in the right direction on creating a low carbon economy.

“But while we hope this announcement will kick-start a serious drive to green our nation’s housing stock, ministers should simply have put more money into this scheme – as the scale of the challenge is just so great.”