Government launches social and affordable homes programme with initial £10bn allocation

The UK Government has launched the first phase of its £39 billion (€46 bn) Social and Affordable Homes Programme (SAHP), allocating nearly £10 billion (€11.7 bn) to deliver more than 70,000 new council, social and affordable homes across England.

Credit: Aston Rowe

The announcement marks the largest move in decades to put councils back at the centre of housebuilding, with ministers emphasising a renewed focus on delivering genuinely affordable homes for families stuck in temporary accommodation or on long waiting lists.

The funding will be distributed to 33 Strategic Partners including councils, housing associations and other providers. Around 60% of the homes supported through this first tranche are expected to be for Social Rent.  =

Prime Minister Andy Burnham said “No child should be raised in a hostel room and no family should wait ten years for a front door of their own. Councils built this country out of a housing crisis once before. Backed properly, and trusted to get on with it, they will do it again.”

Secretary of State Angela Rayner said the programme reflects the government’s commitment to expanding access to secure housing. “Families can’t be left raising children without a place to call home,” she said. “That’s why the Prime Minister and I are doing everything we can to get councils building once again.”

More than £2 billion (€2.3 bn) of the initial allocation will be spent in mayoral areas outside London, with Established Mayoral Strategic Authorities setting the strategic direction for investment. London will receive at least £6 billion through the programme, with councils expected to deliver more than half of the homes funded in the capital. Mayor Sadiq Khan said the funding would help thousands of Londoners move out of temporary accommodation and into long‑term affordable homes.

Homes England Chief Executive Amy Rees said the announcement represents a major step in delivering the ten‑year programme. She said the agency’s partnerships with councils, mayors and housing associations will “support the return of council housebuilding at scale, increase the supply of social rent homes and create thriving places that people are proud to call home.”

Sector leaders welcomed the announcement. Kate Henderson, Chief Executive of the National Housing Federation, said the funding is “hugely welcome” and a major vote of confidence in housing associations. Gavin Smart, Chief Executive of the Chartered Institute of Housing, said the investment has the potential to reduce homelessness and ease pressure on temporary accommodation if delivered at pace.

Kush Rawal, managing director of for‑profit housing association Funding Affordable Homes, said the announcement provides long‑term certainty for the sector. He noted the emphasis on social rent “suggests ministers are keen to demonstrate delivery of genuinely affordable homes rather than simply housing numbers,” and welcomed the decision not to reserve funding solely for councils. “Well‑capitalised for‑profit RPs that can demonstrate strong governance, tenant outcomes and alignment with social objectives should remain well placed to play a meaningful role,” he said.

Paul Rickard, Chief Executive of Pocket Living, said the clarity provided by the first tranche of SAHP funding is welcome but warned that grant allocation alone will not solve the wider development slowdown. “This funding needs to be delivered in parallel with renewed efforts to tackle the development viability challenge strangling housebuilding in the UK.. To deliver the affordable homes the country needs, we need to unlock housing delivery across the board and get the housing market moving again ahead of the Budget, capitalising on the recent positive changes to the planning system.”

Adam Daniels, Chief Executive of Vistry, said the announcement reflects the long‑standing partnership between the housebuilder and Homes England. “Vistry has received direct grant funding awards under successive affordable homes programmes for nearly twenty years, and this award reflects our established track record and commitment to delivering much‑needed affordable homes in collaboration with Homes England and our partner providers.”