The government has failed to get to grips with the shortage of housing, according to a Huddersfield man.

Phil Shanks, chief executive officer for real estate investment trust Houses for Homes, said the Chancellor had “improved the picture a little” with his Budget measures for the sector.

But he said: “I think it is noteworthy that the total coverage for housing in the 120 page budget report was little over one page.”

Mr Shanks said the £500m builders finance fund for SME builders would kick start 15,000 units and provided recognition that one reason the supply of housing was stagnating was lack of finance for builders. But he said its scale was “puny” and added: “If we aspire to hit the target of 200 000 new housing starts a year we need a pot 10 times the size.

“The £150m fund to kick start the regeneration of large housing estates through repayable loans is intended to boost housing supply; presumably by bringing back empty homes into use. It’s a small but useful measure that needs to be rolled out beyond the three named projects, all in London but must be welcome, as long as it has the scale needed.

“Additionally there are some promises of new relaxation in planning consents, particularly regarding change of use. These are particularlyhelpful for developers and are a genuine step in the right direction.”

But Mr Shanks said: “The main thrust of the budget is centred on stimulating demand, via Help to Buy and soon “Right to Build” rather than building supply.

“The reason we have rents currently rising at twice the rate of wages is to fuel the demand-led housing recovery process, a point confirmed to me by a member of the CTLG parliamentary select committee.

“When asked if we should cap rents he told me that the committee had considered this but felt that rising rents were the best tool to stimulate housing investment.

“The measures announced by the chancellor are too small to have any impact on housing supply. But they do have sufficient force to feed an unhealthy property market, demand-led and predicated on rising prices. I think we can look forward to a slow and painful recovery, particularly in the private rented sector and this budget practically guarantees it.”

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