September 4, 2016 / 11:07 AM / 3 years ago

UK plans 3 billion pound house building fund to boost sector post-Brexit - report

Estate agents boards are lined up outside houses in south London June 3, 2014. REUTERS/Andrew Winning/Files

LONDON (Reuters) - The British government is set to announce a 3 billion pound house building fund to provide developers with cheap loans to boost the sector following the vote to leave the European Union, the Sunday Telegraph newspaper reported.

Finance minister Philip Hammond, who has talked of the need for a “fiscal reset”, is due to set out the government’s fiscal response to the June 23 vote in an autumn budget statement, although no date has yet been set for it.

The fund is expected to combine several existing schemes, including a 525 million pound builders fund and a 1 billion pound large sites infrastructure programme, but will also include new money to encourage developers to build new homes, the newspaper said, citing government sources.

It said the fund would be targeted at small and medium-sized developers, offering cheap loans or financial guarantees. It also reported the fund would be designed to reduce red tape which has hampered previous schemes.

The finance ministry had no immediate comment.

Housing market data published around the Brexit vote has been mixed, with official figures showing construction output fell sharply in May and an industry survey showing the referendum had an immediate impact on the housing market.

Other data published in July, however, showed the number of new homes registered for construction in Britain rose in the second quarter to its highest since 2007.

Reporting by Kylie MacLellan; Editing by Mark Potter

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