Housing minister Kris Hopkins has visited not-for-profit housing provider Four Housing to discuss affordable housing in Berwick.
There is currently a huge demand for more affordable housing in the north east, with 59,000 people currently on the waiting list.
The problem is particularly acute in coastal parts of north Northumberland where locals have been priced out of the market by holiday home owners.
The MP met with Paul Tanney, chief executive at Four Housing to discuss what can be done to address the housing shortage in the area.
Mr Tanney said: “My key message for Kris was that if we are to meet current and future housing need, the financing model surrounding affordable housing needs to change.
“A one size fits all approach to affordable housing across the UK needs to change to take account of vastly different circumstances in the south east to the rest of the country.
“Under the current funding arrangements, most affordable housing is funded through a combination of government grant and borrowing. As grant levels continue to reduce, housing providers have to borrow more. The higher cost of borrowing is then reflected in higher rents for social housing residents, as housing associations move towards ‘affordable rent’ – which can be up to 80 per cent of the full market value.
“In many parts of the north east there is not a significant difference between market rent and social rent levels due to the depressed housing market. This means that ‘affordable rent’ levels result in very little extra income for the housing association to pay for the extra borrowing and therefore less funding to build additional new homes.
“If we are to tackle the UK’s housing crisis, there is a need to look at increased grants and a return to social housing rents. This would enable social housing providers to build more homes in the right location, with rents that are truly affordable.”
Anne-Marie Trevelyan, Berwick Conservative candidate, added: “It is very encouraging that Kris Hopkins MP has made the effort to see for himself first-hand the housing challenges facing the county.”
Meanwhile, energy efficiency works on only 38 of 502 properties in Newfields and Highcliffe were not completed by the March 31 deadline.