Councils to get cash incentives to build homes

Housing Minister Grant Shapps has made good on his pre-election promise and released details of plans to gives local councils extra funding if they build new houses.

Under the new plans, the government will match the council tax raised on each new house for six years. Local councils may choose how to spend this extra funding.

Shapps confirmed that councils who give planning consent and support the construction of new homes where they are needed and wanted will receive direct, substantial benefits.

The New Homes Bonus, to be introduced early in the Spending Review period, is intended to reverse the decline in the number of homes being built, currently languishing at its lowest peacetime level for 80 years.

Shapps said: “We will not tell communities how or where they should grow. But the new Homes Bonus will ensure that those communities that go for growth reap the benefits of development, not just the costs.

“With housebuilding at its lowest peacetime levels for over 80 years action is needed now to build the homes the country needs. That’s why these new powerful incentives to build will be introduced early in the Spending Review period. And it’s why I have confirmed that those councils who go for growth now will reap the rewards.

“So I urge councils to seize the moment and open up a debate with their communities now about the new homes they need and how they would use the new Bonus.”