The British government and Barclays have launched a fund of £1 billion on Wednesday (12) to help construct houses across England to raise the pace of construction in an attempt to reduce England’s housing shortage and increase the pace and volume of housing provision.
The fund aims to help small house-builders in an attempt to tackle England’s housing shortage.
Loans ranging from £5 million to £100m, which will be competitively priced, are available for developers and house builders who are able to demonstrate the necessary experience and track record to undertake and complete their proposed project.
The agreement with Barclays forms part of the government’s wider commitment to increase the pace of housing delivery in England. The British government is clear on its ambition to achieve 300,000 new homes a year by the mid 2020s, which follows 217,000 homes built last year, the biggest increase in housing supply in England for almost a decade.
Out of the £1bn fund, Barclays is providing £875m and Homes England, the Government’s national housing agency, will contribute £125m.
The total funding for a development scheme is up to 80 per cent loan to cost and 70 per cent loan to value allowing developers to stretch their equity, capital further.
A key priority of the housing delivery fund is to support small and medium sized businesses to develop homes for rent or sale including social housing, retirement living and the private rented sector, whilst also supporting innovation in the model of delivery such as brownfield land and urban regeneration projects.
Launching the fund, John McFarlane, Barclays’ Chairman, said, “there is a vital need to build more good quality homes across the country. This £1bn fund is about helping to do exactly that by showing firms in the business of house building that the right finance is available for projects that help meet this urgent need.”
“.…This new fund - partnering Homes England with Barclays - is a further important step by giving smaller builders access to the finance they need to get housing developments off the ground,” said housing secretary Rt Hon James Brokenshire MP.
