Brian Berry, FMB chief executive, described the announcement as the most exciting and potentially transformative announcement on council housing for many years.
“It is something the house building sector and local authorities have been crying out for since the last economic downturn as a means by which to increase house building,” he said.
“Local authorities have a strong interest in delivering new affordable homes and many would have the appetite to directly fund this, but have been frustrated from doing so by an artificial cap on their ability to borrow against their assets to build homes.”
The FMB also believes it could have the added benefit of expanding the capacity of the private sector by providing more opportunities for SME builders.
However, Mr Berry warned that recent announcements on post-Brexit immigration rules, if implemented as currently understood, will be a serious threat to the construction industry’s ability to deliver on the promise of this policy, as there may not be sufficient numbers of building skills to construct extra homes needed.
