Will the Budget tackle housing shortfall?

The pressure is building ahead of next week’s Budget, as the housing industry waits to hear the Government’s plan for steering the market out of recession.

While housing concerns are bound to feature in the 2009 Budget, SmartNewHomes.com is calling for Alistair Darling to look at the wider picture of future economic recovery and focus initiatives on improving housing supply – which has fallen to dangerously low levels as a result of falling house prices and the collapse of mortgage lending.

With the focus of government rescue packages so far concentrating on cash injections to the banks, SmartNewHomes.com warns against overlooking the future production of new homes, particularly as there are strong signs of increasing buyer demand.

The Chancellor is being urged to support the housebuilding industry directly, and invest public funds into the production of new homes. Developers are charged with meeting the government’s increasingly insurmountable housing targets, and while many developments currently have the green light to proceed, production has often stalled due to the economic climate.

David Bexon, Managing Director of SmartNewHomes.com, comments:

“The government has pumped billions of pounds into the banking sector with the aim of giving mortgage lending a shot in the arm. While there are now tentative signs of improvement in mortgage availability, any impact resulting from government intervention has taken far too long to filter through and aid developers.

“New home starts have been severely damaged by the lack of mortgage finance and the resulting house price decline. As things stand, developers will be neither financially or personnel equipped to meet the current pent-up demand once the market begins its recovery.

“The Budget is the Chancellor’s opportunity to support the housebuilding industry, which has been among the heaviest hit in terms of output and redundancies, and show an ability to think laterally on housing’s key role in combating the recession.

“I urge the Chancellor to allocate funds to developments that have been held up due to the credit crunch, offer support for developers in their obligations to deliver social housing, and remove some of the red-tape that works to delay the planning process.”

For more information and to search the database of new homes visit Smartnewhomes.com.