Housing Minister Grant Shapps confirmed the first cash payments through the New Homes Bonus, totalling almost £200 million for areas building new homes.
In a letter to council leaders, Mr Shapps said these powerful incentives have the power to transform housebuilding by encouraging local communities to support rather than resist development - but it is vital that residents now have the opportunity to choose how these building bonuses are spent.
Through the New Homes Bonus, the Government will match the Council Tax raised from new homes for the first six years. The bonus available for an affordable home will be up to 36% more than for a similar market home - equivalent to an extra £350 per house premium every year. Empty properties brought back into use will also receive the cash bonus for six years.
Consequently, councils can receive payments of almost £9,000 on average for each band D home, or almost £11,000 for an equivalent affordable home. To illustrate the effect - if an area increased the number of homes by 1,000 units this could earn a community almost £10 million to spend as they see fit.
Under the first cash payments for the scheme, 326 local authorities will receive a share of £200 million for increasing the effective housing stock by almost 150,000 in 2010-11.
Communities themselves will decide how to spend this extra funding - whether by Council Tax discounts for local residents, boosting frontline services, or providing new local facilities.
The implementation of new international accountancy standards could reduce the book value of England's housing associations by over £1 billion and cost £150 million in red tape.
In issuing this stark warning, the National Housing Federation has prompted fears that plans for thousands of new affordable homes will now be axed to cover the costs of the new system.
The Federation's warnings have generated wide discussion - for a fuller text click here.
