The review said the Help to Buy scheme turned Homes England into the sixth-largest mortgage lender live loan book, valued at £18.9bn.
The review said it made sense for the body to set up the scheme when it was introduced, which left Homes England managing “significant risks”, which is different from its other functions.
Help to Buy loans are administered under a contract with the private sector and Homes England oversees the loans, which the review said was a “distraction” from its core functions.
The review said this was also true, but to a lesser degree, for elements of the Building Safety Programme. It said it made sense for Homes England to support the funds for cladding remediation, and while it required engagement with residents, it also involved “extensive communications” with freeholders and developers that aligned with the body’s experience.
It said although building safety overlapped with housing quality, regeneration and net-zero, the work was primarily “critical life safety remediation”.
The review said Homes England needed a focused approach to housing supply and regeneration, which would be “difficult to achieve” if it continued to oversee Help to Buy and the Building Safety Programme.
It recommended that Help to Buy be “managed fully in the private sector or under a contract with the government” in the medium term.
Building safety and standards policy would have to address a “broad need for remediation to achieve quality improvements, net-zero and higher standards more generally across the whole housing stock,” it added.
Customer satisfaction
As Homes England continues to oversee Help to Buy loans, the review said it should improve its online communications in the meantime.
Independent research suggested that people who needed help from Homes England or the mortgage administrator to manage arrears or redeem their loan experienced “significant problems”, the review said.
This happened during a transfer to a third-party company to manage the portfolio, which led to disruption and delays that “risked jeopardising housing transactions or exacerbating customer arrears”.
Homes England has invested in short-term resources to bring down call waiting times, which has resulted in an improvement to the call answer rate.
However, there is no online platform, meaning enquiries are managed through email and telephone call centres “that may not always have sufficient capacity to deal with the demand”.
It said there were longer-term plans to introduce digital services, which would require additional investment.
Homes England also engages with residents in the households registered for the Cladding Safety Scheme. The review said that, as the scheme was “still ramping up”, the impact on customers had been limited.
While no issues have come up, Homes England has developed surveys for residents and leaseholders to gain a better understanding.
Remain in its form
The review said Homes England should continue to be a non-departmental public body, adding it played an “important role in housing supply, regeneration and placemaking”.
Over the last five years, Homes England has supported the development of 86,413 new homes, unlocked land that could deliver a further 392,000, helped 252,543 households into homeownership and invested £11.1bn.
The review concluded that England and the government “need Homes England”, adding it had the “right powers and form, and most of the capability and tools to deliver better housing and better places”.
However, some changes are needed to maximise its impact, the review stated.
It also suggested allowing the body to take on more risk to improve its impact, make its programmes “easily accessible to small and medium-sized enterprises [SMEs], and make future plans more flexible.”
The review also recommended setting budgets and efficiency targets that considered its widened responsibilities for regeneration and placemaking.
It said Homes England should develop its operating model to show how resources were being deployed, as well as improve its systems and governance.
Michael Gove, secretary of state for Levelling Up, Homes and Communities, said: “Today’s independent report shows Homes England is the right vehicle to deliver more affordable homes and support our plans to regenerate towns and cities across the country.
“I welcome the report and its recommendations, and we will work closely with Homes England to finalise an implementation plan. This builds on our long-term plan for housing to further strengthen Homes England’s record of delivery, so we can deliver more homes that are affordable, beautiful, and built in the right places.”
