New Homes Bonus' allocations announced

A total of 326 local authorities will share close to almost £200m between them in 2011/12 to incentivise the construction of new homes in their local region.

Housing minister Grant Shapps has announced that each council have funding from £5,000 in the first year of New Homes Bonus handouts to spend on the new homes and local improvements.

The highest payout went to Tower Hamlets in London which received £4.29m payment for 2,934 new homes being built in the local area.

A number of new homes in Birmingham and new homes in Manchester will be built, after the two cities were awarded £3.2m and £2.6m, respectively.

The government, which is desperate to increase the supply of new homes in this country which is at a record low, has gambled on scrapping new home building targets and replaced it with the New Homes Bonus, which it hopes will incentivise local councils to say yes to more new homes n their local areas.

Shapps commented: "The system where Whitehall told communities what homes they need to build never worked.

"Housebuilding declined for years, eventually slumping to its lowest peacetime level since 1924.
"The construction industry suffered terribly, and in many areas plans for new homes created a bitter legacy of divided communities and animosity towards developers."

The Government is committed to match the council tax raised from new homes for the first six years.