Hammond promises to fix the housing crisis by committing £44bn in capital funding for the housing market

Helen Cahill
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Penzance House Prices Rise The Highest In The UK Over The Past Decade
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Philip Hammond today promised to fix the housing crisis by committing an additional £15.3m in capital funding for the housing market.

The funding will be made available over the next five years in loans and guarantees, bringing the total support offered by the government to £44bn.

The chancellor said he recognised that the housing shortage could not be fixed without a strong construction sector. In particular, small and medium-sized housebuilders, which were hardest hit during the financial crisis, would need help from the government, he said.

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"House prices are increasingly out of reach for many," Hammond said.

"Successive governments for decades have failed to build enough homes."

Brian Berry, chief executive of the Federation of Master Builders, said Hammond had delivered a "budget for builders" with a promise of a further £1.5bn for the Home Building Fund. The fund targets small and medium-sized developers.

"Today the chancellor has put small and medium-sized builders at the heart of ambitious plans to tackle the growing housing crisis," Berry said.

“A second major challenge to getting new homes built is the skills crisis we face. In the long run, the only real solution to chronic skills shortages will be a major increase in the training of new entrants into our industry."

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Adam Challis, head of residential research at JLL, said the capital funding would be "game-changing".

"The SME community needs a hand up, not a handout," Challis said. "At the same time, Government has recognised that building new homes is not a level playing field. In order to get more small developers building, it is providing a lot of direct support that will reduce risks for this group."

Local authorities will be allowed to charge a 100 per cent rate of council tax on empty properties, Hammond also said today.

He defended the government's record, saying housebuilding stands at its highest level since the financial crash.

The government has also abolished stamp duty for first-time buyers on purchases of up to £300,000.