House building crisis

Government figures have shown that the number of new homes completed in England last year fell to its lowest level since 1923. With just 102,570 properties being built in 2010, 13% down from the previous 12 months, and the lowest level during peacetime since 1923, according to Communities and Local Government.

The annual level is well below the 232,000 properties it is estimated need to be built in England each year to keep pace with rising demand.

The figures came as the Government announced the first £200 million of a new scheme to encourage local communities to build more homes has been allocated to councils. It has set aside nearly £1 billion to kick-start its New Homes Bonus initiative, which will see local authorities given extra cash for every new home built in their area.

Under the scheme, the Government will match the council tax raised through new homes for the first six years, with councils receiving up to 36% more for affordable homes. Money will also be paid for empty homes brought back into use. As a result, councils will get an average of more than £9,000 for every band D home built, or nearly £11,000 for an affordable property, during the six years. The Government estimates that a community that builds an additional 1,000 properties could earn up to £10 million.

Around 326 local authorities will share the first £200 million, with Tower Hamlets getting the most at £4.3 million, followed by Islington at £3.7 million and Birmingham at £3.2 million. Other councils making the top 10 that will receive the most from the first payout include Manchester, Leeds, Bristol, Bradford and Milton Keynes.

A new housing development in the Otley Road area of Bradford.