Ministers will commission the building of 13,000 homes on five sites around southern England, the largest housing project led by central government since the redevelopment of the Docklands in east London in the 1980s.
No 10 said that the projects signalled “a huge shift” in government policy and would begin with the building of 3,000 homes on four sites outside London in 2016.
David Cameron said: “Nothing like this has been done on this scale in three decades – government rolling its sleeves up and directly getting homes built.”
Ministers will directly commission an as-yet-unspecified number of homes on the Old Oak Common site in Hammersmith and Fulham, which has space for 25,000 homes.
“This government was elected to deliver security and opportunity - whatever stage of life you’re at,” said Cameron. “Nothing is more important to achieving that than ensuring hardworking people can buy affordable homes.”
The intention is for the direct commissioning approach to support smaller companies – which are ready to build but lack the resources to apply for planning permission – to get building on government sites where consent is already in place. The top eight housebuilders in the country currently provide 50% of new homes.
Outside London, building work will take place on the Connaught Barracks in Dover, Kent, Northstowe in Cambridgeshire, Lower Graylingwell in Chichester, West Sussex, and Daedalus Waterfront in Gosport, Hampshire.
The duration of the first phase of the scheme has not yet been formally specified, but the first 13,000 homes are expected to be built over five years. £100m has been put aside to prepare publicly owned sites for house building.
The communities secretary, Greg Clark, said the government was “pulling out all the stops” to hit its target of creating a million new homes by 2020.
In his March budget, chancellor George Osborne announced that researchers at the University of York were investigating the feasibility of the government directly commissioning house building on a large scale – an idea first put forward by former Liberal Democrat chief secretary to the Treasury Danny Alexander.
The researchers, led by ProfRebecca Tunstall, director of the Centre for Housing Policy, looked at how housing associations commissioned the not-for-profit building of new homes as a model for government to follow.
A pilot scheme for direct government commissioning of 10,000 homes in Northstowe, Cambridgeshire, was announced by Osborne in the 2014 autumn statement.
The government has also officially announced a £1.2bn fund to prepare brownfield sites for the building of new homes intended for first-time buyers under the Starter Homes scheme. The money was first identified in last month’s spending review.
A starter home is a property sold to a first-time buyer aged under 40, for at least a 20% discount of its market value, with a cap on the value of the property. In London, the maximum cost of a qualifying home will be set at £450,000; outside London it will be £250,000.
The government has pledged to build 200,000 starter homes by 2020 and said the new fund would fast-track the building of 30,000 new homes.
The shadow minister for housing and planning, John Healey, responded to the government’s starter homes announcement, saying: “In the autumn statement a few weeks ago, George Osborne tried to spin his halving of public housing investment as an increase. Now David Cameron is laying on the rhetoric to hide his failure on new homes.
“Today’s statement promises no new starter homes beyond those already announced,” said the MP for Wentworth and Dearne.
“With home ownership down to the lowest level in a generation and fewer homes built over the last five years than under any peacetime government since the 1920s, David Cameron needs to do much more to fix his five years of failure on housing.”
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