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What would be the best use of the £1.9bn of housing cash given back to the Treasury?

Journalist: Warren Lewis, Property Reporter

ended 13. July 2023

Earlier today, it was revealed that Michael Gove has given £1.9bn of funding back to the Treasury after reportedly struggling to find housing projects to spend it on.

However, with England currently having the lowest numbers of homes per 1,000 people in Western Europe, housebuilding targets effectively scrapped, a broken planning system, and a mortgage crisis gathering momentum at a worrying pace, surely there must be some use for this nearly two billion in 'unneeded' cash.

We're looking for your comments, suggestions, and insight on where this money should be spent to help fix the housing market.

6 responses from the Newspage community

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Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
Michael Gove needs his P45. Use the money to incentive local authorities to want building projects in their area, and for a replacement scheme now Help to Buy is closed. The government is unimaginative, stale and needs replacing. Just add the to the treasury coffers and wait til they are replaced. I expect Labour to have more creative ideas.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
I believe the answer here is simple, provide the money to councils to build a new stock of affordable housing and social housing within their council areas.
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Justin Moy
Managing Director at EHF Mortgages
The government cannot have it both ways - higher mortgage rates and the state of the economy aren't exactly making it attractive for builders to invest, and the buyers are struggling to justify the high rates. So if you want to use Base Rate (via the BofE) as the only tool to reduce inflation, you become the lowest-ranked country in Europe for housing.

Perhaps the Government can turn this into some form of cheaper borrowing that banks can plug into to then offer to certain types of borrowers. Not necessarily purely for new build, but for those purchasing any property rather than remortgaging.

"It's just another fine mess you have gotten us into" - now where have I heard that before..

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Gary Bush
Financial Adviser at MortgageShop.com
It would be lovely to see the £1.9bn of funding used on the local authorities, not private building corporates, building more low-cost housing that are all shared ownership, making them more affordable to borrowers. I'd love to have said as an alternative for the government to give the money back to the UK's struggling mortgage holders to help with paying their increased mortgages but with 25.4 odd million such households they would all only get £74.80.
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Louise Holme
Business Owner at HolmeStores
It is surely time to change our approach to commercial housing in this country. Our homes define our health, and need a holistic perspective that can successfully seek to resolve the problems with society, ageing populations, health, sense of community, and of course our natural environment. Many other developed countries are trialling new house building schemes that don't saturate the land with brick and concrete with remote and soulless out-of-town estates. Acknowledging that multi-purpose land estates that can provide natural environments and small-scale regenerative farming in harmony with innovative and efficient community-based housing is the first step in saving our physical health, mental health, farming methods and housing problems. Having single-purpose departmentalised budget funding no longer works...Government departments need to stop firefighting and instead work together to collaboratively create and finance ambitious plans for the future of this country.
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
Would it be too obvious to say "build more homes"? A £1.9bn Social Housing build program could see many people currently sitting in inappropriate housing moved into proper, long-term homes. The stock of social housing of all types has reduced over the decades, due to more and more people taking the option of the Right-To-Buy scheme, but no replacement stock being built. The upshot is that Councils have a duty to house people, but own very limited housing stock in which to do it. Plus we are told of the economic advantages of large-scale infrastructure projects (it was one of the key arguments used as to why we should build HS2), so something of this scale should be a big boost to the UK economy.