The Homes and Communities Agency (HCA) has shortlisted 265 bids totalling nearly £550 million in Round 2 of its Kickstart housing delivery programme.

Shortlisted bidders include a mix of Registered Social Landlords (RSLs) along with national and local developers, aiming to unlock up to 22,000 homes across the country.

Bidding opened on 14 September 2009 with the criteria that eligible schemes should be housing-led with a minimum of 50 homes and that sites should have detailed planning consent in place or the ability to achieve this by the end of March 2010.

In contrast to Round 1 shortlisted bids, the profile of spend for Round 2 shows a shift towards HomeBuy Direct (HBD) which, according to the HCA, reflects an improved liquidity position for the major house builders but a continuing need to support first time buyers who face constraints on accessing mortgages. A number of key regeneration sites have also been shortlisted where a more intensive intervention of HCA equity / gap / loan and support for affordable housing is needed.


Sir Bob Kerslake, Chief executive of the HCA, said: "Kickstart continues to be a crucial component in maintaining momentum in the house building industry. In this round we have seen a marked increase in requests for HBD funding and this indicates how the appetite for HBD has accelerated as an attractive option for first time buyers, which in turn is fuelling demand for homes. This shift in the bidding profile has enabled us to increase the target for HBD by a further 3,000 units next year, as set out in the PBR last week."

A due diligence process will now follow, which will look in detail at value for money, design, financial viability and risk, as well as an assessment of quick delivery.

Mr Kerslake added: "Kickstart was a brand new programme for both the HCA and the industry, with a steep learning curve. So we are sharing the lessons from Round 1 and this should ensure that Round 2 will be a more streamlined process. The findings report will provide a useful steer to new and existing bidders on what we are looking for and how they can make their schemes successful."

The Round 2 shortlist of schemes does contain a degree of 'over programming' to take into account that some schemes may not comply with the due diligence process and others may ‘drop out’ or withdraw, for example through market improvement. A reserve list has also been created by the HCA.

(CD/BMcC)