David Cameron Will Allow £450,000 Homes To Count As Affordable Housing

    Campaigners said the Tories' new planning policy will take money away from low-income renters and hand it to first-time buyers.

    David Cameron has pledged that 200,000 "starter homes" will be made available to first-time buyers by 2020.

    The coalition had already unveiled plans to offer 100,000 discounted homes to first-time buyers aged under 40.

    But the prime minister proudly announced on Monday that the Conservatives would double that number if they won the election. The aim is to help more young people get on the housing ladder.

    Starter homes are properties built on disused "brownfield" land that will be sold at a price at least 20% below the market value.

    The discount will be paid for by waiving the fees that homebuilders have to pay to local authorities under so-called Section 106 agreements.

    Homes worth up to £450,000 in London and £250,000 outside the capital will be eligible.

    There's a hitch, though. The Conservative Party has confirmed to BuzzFeed News that starter homes officially count as affordable housing.

    Private developers have to provide a certain proportion of affordable homes when they build new projects. This is to help people who can't afford to buy or rent on the open market.

    Affordable housing models include "social rent", where the rent is set at 40% of market rent, "affordable rent", which is set at 80% of market rent, or "shared ownership", where you buy a share of your home and pay rent on the rest.

    Targets are set locally by councils depending on demand, and on the costs of housing and wages.

    But as first reported in Inside Housing, starter homes will now count as affordable housing – rather than being in addition to it.

    That means developers can include houses worth almost half a million pounds in the proportion of affordable housing they have to deliver – potentially replacing social housing or shared ownership.

    Campaigners have warned that there would be a "strong incentive" for developers to build starter homes instead of other types of affordable housing because they will get a higher return.

    Moreover, the coalition's record on social and affordable housing is not an encouraging one. In 2011, it pledged to replace every affordable home sold under the right-to-buy scheme "on a one-for-one basis". But it emerged in January that for every five properties sold in the social housing sector, only one new home has been built.

    Spiralling house prices mean soaring numbers of people aged 25-34 are being forced into renting.

    And the campaign group Shelter said Cameron's plan would only make the situation worse.

    Its chief executive Campbell Robb said: "The bottom line is that you don't solve an affordability crisis by getting rid of affordable housing.

    "Two hundred thousand homes over the course of a parliament sounds good on the surface, but in reality this is giving with one hand and taking with the other.

    "Removing the requirement on developers to build affordable housing is extremely worrying, and won't help those currently struggling with sky high housing costs."

    Cameron announced on Monday that Britain's biggest developers, including Taylor Wimpey and Barratt, have already signed up for the scheme.

    "Our goal is a Britain where everyone who works hard can have a home of their own," he said.

    "We've shown what we expect starter homes to look like - not rabbit hutches or shoeboxes, but decent, well-built, homes with gardens - places to start and raise a family."

    A Conservative spokesman said: "Starter homes will be sold at 20% below market price and with 200,000 being built, will help tens of thousands of young people realise the dream of owning their own home."