Back in March, the government confirmed the same sum for 12,500 social rent homes in London.
This funding will include homes let at social rent in ‘high cost areas’, alongside other tenures such as affordable rent and shared ownership.
Secretary of state for communities, The Rt Hon James Brokenshire MP has also invited local authorities to bid for a share of £1bn extra borrowing and the borrowing cap raise will be split equally between London and the rest of England.
Local authorities have requested this extra financial flexibility, which will be allocated to those in areas with the highest affordability pressures to ensure homes are built where they are needed most.
An area of affordability pressure would be defined as an area where there is a difference of £50 more per week between average private sector rents and social sector rents.
The way ahead
The government said these new measures are part of the government’s plans to build 1.5m new homes by 2022 through planning reform and targeted investment.
Communities Secretary Brokenshire said: “Today’s announcement is a further milestone. It will secure the delivery of an additional 23,000 much-needed affordable homes as well as paving the way for a new generation of council houses.
“A bidding process will now begin for both programmes, with successful bids for the affordable homes funding notified throughout the year. A list of successful councils who have had their borrowing caps increased will be announced in due course.”
Craig Hall, new build manager, Legal & General said shared home ownership will be increasingly key for London homebuyers and across the country with 10 potential buyers for every property built.
“Over the last couple of years, Legal and General has been leading the charge to get more lenders to commit to shared home ownership mortgages and improve lending policies for borrowers with a small deposit. We are now getting to see these homes being built,” Hall added.
Government figures suggest since 2010 over 378,000 affordable homes have been built.