Blueprint for 6,500 cheaper homes

The shortage of affordable housing has been highlighted recently Mother's struggle on housing ladder Q&A: How might 6,500 homes be built?

Housing associations should be able to borrow over £100m to build new homes in Wales, according to a report the assembly government called "seminal".

The study, by former Labour minister Sue Essex, outlined to ministers how 6,500 new affordable homes could be built in Wales by 2011.

Councils would also be expected to free up land for building.

Another proposal is aimed at ensuring private developers build affordable housing alongside more expensive homes.

The blueprint is aimed at meeting the crisis in affordable housing in Wales.

The assembly government commissioned the report, by former Labour cabinet minister Sue Essex, to advise how it can deliver the One Wales aim of providing an additional 6,500 affordable homes over four years.

Affordable housing

It wants to ensure "all households, in all communities and irrespective of their means, can afford a decent home".

The report also says councils need to get better deals from developers, forcing them to provide more affordable housing in their plans.

The belief of many of those working in the sector that the assembly government should cut bureaucracy and allow housing associations more freedom has been backed by the report.

Deputy Housing Minister Jocelyn Davies told AMs it was a "seminal report" for "anyone interested in housing in Wales".

She said: "For the Welsh Assembly Government, it challenges us to lead the change necessary.

"For local authorities, it challenges them to enable partnership working and manage performance.

"For housing associations, it challenges them to become more innovative and use their assets more effectively to increase investment."

Ms Davies warned that with the difficulties the housing market was now facing, the challenges were "much greater" than when the report was commissioned.

She said she would now "invite a wide ranging debate on the report, its recommendations and how we work together to implement it".

'Next generation'

Shadow Social Justice Minister Mark Isherwood welcomed the study which he called "timely".

"Ministers need to recognise that due to the credit crunch many mortgage lenders are withdrawing funding, while developers are reconsidering their own house building proposals, he said.

Earlier this month a report by The Joseph Rowntree Foundation highlighted the shortage in affordable housing in many parts of Wales.

It warned parts of the countryside "will lose the next generation of young people" without big changes in policy.

It also found average house prices were more than five times the average income in all rural local authority areas.