Councils receive £3.4bn bonus for building new homes

Councils have received nearly £3.4bn through the New Homes Bonus for building over 800,000 more homes, it was announced yesterday.

Figures released by the Department for Communities and Local Government showed that in the year to October 2014, councils have helped provide 154,000 newly-built homes and conversions, including over 42,000 affordable homes and brought over 10,000 empty homes back into use.

Housing Minister Brandon Lewis said: “Councils have received more than £3bn for their part in getting Britain building, and as a result housing construction has reached its highest level for seven years.”

Yesterday the minister announced the provisional allocation of £1.2bn New Homes Bonus to councils in England in recognition of this.

Since the New Homes Bonus was introduced in April 2011 councils have received almost £3.4bn, including a £15m premium for providing affordable homes. Councils are free to spend the money as they see fit to benefit the local area.

An evaluation report on the New Homes was released yesterday, which found that almost 50% of planning officers agreed the bonus was a powerful incentive for supporting housing growth. It also concluded the New Homes Bonus is largely matching the distribution of housing need and the policy is particularly helping to reduce the number of empty homes.