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LGA survey: councils to use borrowing powers to accelerate homebuilding programmes

Friday March 15th, 2019

New powers to borrow and invest in new and existing housing look set to be used by the majority of councils but further reforms are needed to spark a genuine renaissance of social housing, a survey by the LGA reveals.crane_7245569Med

Last year, the Government accepted the LGA’s call to scrap the housing borrowing cap.

The LGA’s new survey shows the move will support the delivery of local housing with 94 per cent of housing stock-owning councils (59) saying they will use the new powers to accelerate or increase their housebuilding programmes to build homes desperately needed in their communities.

The number of homes built for social rent each year has fallen from over 40,000 in 1997 to 6,000 in 2017. The LGA said this decline has resulted from the policies of successive governments, such as rules and restrictions hampering the ability of councils borrowing to build.

This loss of social housing has led to more and more individuals and families finding themselves pushed into an often more expensive and less secure private rented sector. As a result, the housing benefit bill paid to private landlords has more than doubled since the early 2000s.

However, 92 per cent of councils are clear that more support from government is needed if councils are to truly resume their historic role as major housebuilders and reverse this decline in social housing. There are 205 councils who no longer own any housing stock in their area so will be unable to use new borrowing powers.

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