Housing associations demand £5.3bn to unlock 41,000 social homes

Housing associations are calling for an additional £5.3bn in government funding to unlock 41,000 planned affordable homes. The National Housing Federation, leading the call, states the money is needed to fully fund bids under the Social and Affordable Homes Programme (SAHP).

Housing associations said they could have built an additional 41,000 homes, including 25,000 for social rent, if they had received all the money they bid for. These 41,000 planned affordable homes outside London are currently unfunded under the SAHP. The goal is to bring them forward. The group argues that development could have begun if SAHP bids had been fully funded, putting homes ready for delivery now at risk. Of the overall unfunded homes, 15,000, including 9,000 social rent homes, could be delivered within the next three years.

Economic and social benefits of funding

Unfunded social homes would deliver £6.86bn in economic benefits. Research from the Centre for Economics and Business Research (CEBR) shows 41,000 more social homes would add that sum to the economy. The same research indicates the funding would support 93,000 jobs over the next ten years.

Separately, 25,000 social rent homes would save £291m annually through reduced health and other costs. Housing minister Matthew Pennycook said demand for the SAHP meant the government could have spent the programme's total £39bn a couple of times over.

Government funding and programme details

The government has allocated £9.6bn to support 73,617 social homes. A spokesperson for the Ministry of Housing said nearly £10bn has already been allocated from the SAHP to start building more than 70,000 council, social and affordable homes across England. That investment will help families in temporary accommodation or on waiting lists into safe, secure homes.

The SAHP is a £39bn 10-year fund. Ministers said they are planning to allocate £6bn to London immediately from it. The government plans to allocate the remaining £16bn in later years of the programme. Of the remaining £13bn after the London allocation, ministers said they planned to hand out significant sums in the second half of the scheme, which would come after the next election.

Political and sector support

The call for extra funding is backed by multiple organisations. The Housing, Communities and Local Government Committee supports it. The Chartered Institute of Housing, the Association of Directors of Housing, the Council with ALMOs Group, and the Northern Housing Consortium also back the call.

Abena Oppong-Asare, chair of the House of Commons' housing, communities and local government committee, called for Budget action. She said the government should use the upcoming Budget to increase social home building. The call comes as the government faces pressure to meet its target of building 1.5m new homes across this parliament. Housing secretary Angela Rayner admitted achieving the 1.5m target would be difficult.

The National Housing Federation also urged the government to confirm details of low-cost loans for social housing development announced at the last Spending Review. In London, the situation is particularly acute. London Councils said boroughs bid for £12.3bn from the SAHP to deliver 50,000 homes over 10 years. Some London landlords received only 40% of what they bid for from the capital’s SAHP pot, potentially making specific sites unviable. This was due to a banding system in SAHP applications where landlords scoring below the first band faced a 60% reduction, and those in the last band received no funding at all.

The government's commitment is to allocate £6bn to London immediately from the SAHP, with remaining funds planned for later years of the programme.