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January 9, 2014 12:37 AM EST

Some £500 million is to be made available in the UK to build new affordable homes through an agreement with the European Investment Bank (EIB), it has been announced.

According to Housing Minister Kris Hopkins the deal will result in up to 4,300 new affordable homes to rent across the country.

The funding will form part of the £3.5 billion Affordable Housing Guarantees programme, which enables housing associations to use a government guarantee to secure private investment at more competitive rates than they would otherwise.

‘The deal with the European Investment Bank is a vote of confidence in our ongoing efforts to restore confidence to our housing market and get Britain building. This £500 million investment will help deliver up to 4,300 new affordable homes across the country, on top of the 170,000 affordable homes we’ve already delivered since 2010,’ said Hopkins.

Jonathan Taylor, European Investment Bank vice president responsible for the UK said that the initiative launched will significantly enhance construction of affordable housing by housing associations across the country.

He explained that the European Investment Bank recognises the importance of long-term investment in the housing sector and is pleased to work with the UK government and experienced housing partners through this new, large scale programme.

Richard Blakeway, the deputy mayor for housing, land and property, said that the new funding will help many hard working people who need, and rightly deserve, decent low cost homes. ‘Tackling the demand for housing is a key priority and we all need to work closely together to boost affordable housing supply in London and across the UK,’ he added.

Hopkins also confirmed the first eight housing associations to receive funding through Affordable Housing Guarantees will be Devon & Cornwall Housing Limited, who will borrow up to £85 million to build 887 homes in those counties, Hexagon Housing Association will borrow up to £12.5 million to build 74 homes in Greater London and the South East, First Wessex will borrow up to £88 million to build 589 homes in Hampshire and Surrey, Great Places will borrow up to £50 million to build 674 homes in Manchester and the North, Wales and West Housing Association will borrow up to £25 million to build 251 homes in Wales, Adactus will borrow up to £27 million to build 344 homes in Greater Manchester and Lancashire, Home group will borrow up to £61 million to build 642 homes in England and Paradigm will borrow up to £65 million to deliver up to 594 homes across South and East England and Greater London.

Hopkins also explained that the Affordable Housing Guarantees scheme is one part of a wider package of measures being taken to get Britain building and deliver thousands more affordable homes.

The government is investing £19.5 billion public and private funding to deliver 170,000 affordable homes over this Spending Review, and will invest around £23 billion public and private funding between 2015 and 2018 to deliver a further 165,000 homes.

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