National Housing Federation claims spending review will see housebuilding grind to a halt in the south

The construction of affordable housing will virtually grind to a halt in London and the south east after this week’s spending review, according to the National Housing Federation.

The body, without citing sources, says it believes the settlement will be less than half the £1.6bn current funding for affordable homes, effectively meaning the two regions will only be able to build marginally more than the 12,700 planned under existing commitments. This compares to 30,000 built each year in 2009/10.

The body’s analysis says just 243 extra homes per year will be able to be committed to, and that London on its own will face a £100m funding shortfall.

NHF chief executive David Orr said: “The impact of cuts of this level would lead to the building of affordable housing effectively grinding to a halt over the course of this Parliament.

“Such a slump in affordable housebuilding in London and the South East would not only be bad news for millions of people on waiting lists in the region, but it would be a hammer blow to the regional economy.” 

The NHF claims that by protecting housing spend, the government would have built  103,000 homes in the next three years, saving 156,000 jobs.