The Government’s Starter Homes initiative will narrow housing options for the lowest paid while helping mainly higher earners, according to homelessness charity Shelter
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The government has promised to build 200,000 of the new homes, which will be sold at 80 per cent of market prices, in England by 2020.
However, Shelter fears the scheme will do nothing to help the majority of people on average wages or below into home ownership.
The charity said: [The initiative] won’t even help many people on higher than average wages in many areas of England. The only group it appears to help on a significant scale will be those already earning high salaries who should be able to afford on the open market without Government assistance.’
The problem is made worse, Shelter said, because the government is expected to fund the scheme through removing councils’ ability to demand social rented and other forms of affordable housing from developers.
According to Shelter, Starter Homes for families earning average wages will be unaffordable in more than half of local authorities across the country in 2020.
Families on the National Living Wage will only be able to afford a Starter Home in just 2 per cent of local authorities, it said.
London, the South East and the East have the lowest number of areas where affordable Starter Homes under the schemes threshold could be built, despite high demand in these areas, Shelter found.
The charity said: ‘Starter Homes would primarily help those on very high salaries or couples without children, but they are not a good replacement for other forms of affordable housing and will not help the majority of people on average wages struggling to get an affordable, decent home. The government needs to look very closely at this policy before going down the wrong track.’
Shelter also claims the 200,000 homes proposed through the initiative appear to be included in the government’s overall target of 275,000 affordable homes by 2020, rather than additional to it.
It said: ‘Rather than replacing other forms of affordable housing like shared ownership and social rent, the new Starter Homes should be additional to them, as was suggested originally in the Conservative manifesto for the General Election but no longer seems to be government policy.’
‘The initiative will result in fewer, not more, affordable homes being built’
Labour’s London Assembly housing spokesperson Tom Copley said: ‘Not only will these new homes be unaffordable to working families on average incomes in the capital, the signs are that Government will raid the affordable housing budget to pay for them, resulting in fewer, not more, genuinely affordable homes being built.
“Token schemes like this which appear to move pots of money around instead of actually increasing investment in housing, will not help.”
Shelter fears Starter Homes will only help high earners