The Chancellor also confirmed that the Help to Buy equity loan scheme will be extended until 2020 in his Budget delivered earlier today.
It was announced that in the South East new homes will be built in Brentside; Barking Cross will be regenerated, while the government will push through with its plans for a new garden city in Ebbsfleet.
Osborne said: “House building is up 23%. But that’s not enough.
“That’s why we’re making further reforms to our planning system and offering half a billion pounds of finance to small house building firms.
“It’s why we’re signing city deals across the country to get more built – with a new funding deal this week for Cambridge.
“And it’s why we’re giving people a new Right to Build their own homes and providing £150 million of finance today to support that.
“It’s why we’re funding regeneration of some of the urban housing estates that are in the worst condition, and we’re extending the current Support for Mortgage Interest Scheme to 2016.
“And it’s why we’ve got Help to Buy.
“We’re extending the Help to Buy equity loan scheme for the rest of the decade, so we get 120,000 new homes built.
“In the South East where the pressure is greatest we’re going to build new homes in Barking Riverside, regenerate Brent Cross, and build the first new Garden City in almost a hundred years at Ebbsfleet.
“We’re going to build 15,000 homes there, put in the infrastructure, set up the development corporation and make it happen.
“Taken all together, the housing policies I announce today will support over 200,000 new homes for families.
“We’re getting Britain building.”
John Penn, head of mortgage proposition at Intelliflo, praised Osborne’s Budget.
He said: “The Chancellor’s announcement to increase housing supply is a much needed step for the recovery of the economy.
“While this weekend’s decision to extend Help to Buy is good news for the mortgage market, the resulting increase in demand for property is pushing up prices.”
He said Help to Buy has undoubtedly boosted consumer confidence, yet especially in London and the South East a lack of supply has resulted in souring prices.
Penn added: “Property ownership is unaffordable for an increasing number of people. A fundamental element to help solve this issue is to build more houses, and the Chancellor’s announcement today will go some way towards addressing that.”