Barclays bank has reached an agreement with the UK government to provide £1bn of development finance to fund the construction of thousands of new homes across England.
The bank said it would offer “competitively priced” loans ranging from £5m to £100m for smaller developers and house builders who could demonstrate experience and a track record in the sector.
Of the £1bn fund, Barclays is providing £875m and housing agency Homes England will contribute £125m.
Barclays said a key priority for the Housing Delivery Fund would be to support small- and medium-sized businesses to develop homes for rent or sale, including social housing, retirement living and the private rented sector, while also supporting innovation in the model of delivery, including brownfield and urban regeneration projects.
Barclays chairman John McFarlane said: “There is a vital need to build more good quality homes across the country. This £1bn fund is about helping to do exactly that by showing firms in the business of house building that the right finance is available for projects that help meet this urgent need.
“We are very pleased to be working with government to get the country building more homes, more quickly.”
Housing secretary James Brokenshire said: “My priority as Housing Secretary is to get Britain building the homes our country needs. This new fund – partnering Homes England with Barclays – is a further important step by giving smaller builders access to the finance they need to get housing developments off the ground.”
Ministers have been clear on their ambition to achieve 300,000 new homes a year by the mid-2020s, which follows 217,000 homes built last year, up 15% on the year before. Net additional dwellings reached a recent peak of 223,530 in 2007-08 and then decreased to 124,720 in 2012-13 with the economic downturn.
