Barwell Backs Away from Starter Homes


Starter Homes was always an Alex Morton gimmick to reprioritise home ownerership over affordable rent given low completions.  With that gone the policy has no political purpose.

The new housing minister Gavin Barwell has used his first major speech to shift Government policy away from a singular focus on home ownership.

Speaking at the RESI conference, he said: “We need to build more homes of every single type and not focus on one single tenure.”

He also indicated that the Government is considering abandoning its pledge to build 200,000 starter homes by 2020 due to a shift towards supporting the rental sector.

The Government campaigned on a policy of building houses which would be sold to first-time buyers at a discount of 20pc. However, Mr Barwell said that such policies which encourage ownership and increase the level of demand could affect the number of homes built for rent.

He said: “There’s a little bit of a tension between the overall supply objective and measures specifically to help people on to the housing ladder”. He indicated that affordable rental homes may now be included in that target figure for starter homes.

Mr Barwell added: “The way you make housing in this country more affordable to rent and buy is you build more homes. There is still a role for the government doing specific things to help people on to the first rung but this can’t be at the exclusion of all else.”

In the past, Government policy has largely backed ownership, at the expense of developing the rental market. The Starter Homes policy, which has been greeted with a hesitant response by much of the property industry, has been changed to make councils require a certain amount of them on developments.

The increase of stamp duty for buy-to-let landlords, for example, was also levied on institutional landlordsdespite them having received word from government that would not be the case.

Mr Barwell added: “A growing number of families and young professionals are choosing the [private rental sector], and while home ownership is still the goal for the majority, many will rent for some years before they buy.

“I’m very clear that our ambitions will never be achieved without a significant boost in institutional investment to the [private rental sector], to ensure more choice and quality for people living in rented accommodation.”

Adam Challis, head of residential research at JLL, described the Starter Homes policy as “a big distraction”, and added: “This is welcome news as it signals this Government’s desire to support housing across all tenures.

“The private rented sector is the fastest growing tenure, but had been overlooked under old policy. This is the first step in putting that right.”

Mr Barwell also gave his backing to built-to-rent schemes, and highlighted one by Essential Living in north London, and another by Pocket Living in south London which uses modular techniques.

He added: “Recent growth in the bespoke rental market has been impressive, but this progress must be expanded.”

London’s deputy mayor for housing, James Murray, added his backing to the private rental sector, while defending his 50pc affordable housing target.

He said: “If we’re going to increase supply and have affordable [housing] within that, you need to use every route of delivery, and if build to rent can deliver at scale and speed then we should support that”.


One thought on “Barwell Backs Away from Starter Homes

  1. Reblogged this on Roger Gambba-Jones and commented:
    I just hope Garvin Barwell stays around long enough to actually make this policy work and see it lead to some meaningful outcomes. Of late, the only ministers who seem to stay in post are those with disruption and chaos in mind, with Eric Pickles and John Prescott causing the most of both in recent history when it comes to housing and panning policy.

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