Senior built environment industry figures have welcomed chancellor Rachel Reeves’ pledge to allocate £39bn to the Affordable Homes Programme for the next 10 years as part of the government’s Spending Review.
In addition to allocating additional resources to the programme for 10 years from 2026-2036, Reeves also confirmed a 10-year rent settlement, which will see social housing rents rise by Consumer Price Index plus 1% a year, and pledged to consult on how to implement the return of rent convergence.
In response to the Spending Review, Melanie Leech, chief executive of the British Property Federation, said: “With really tough choices to be made in the Spending Review we are delighted that the government has prioritised the delivery of affordable and social housing and that it is investing significant additional sums to support a sector that has faced tough headwinds in recent years.
“The government has also delivered the 10-year rent settlement that we and the wider sector have been advocating for a long time. This is a significant step forward to help the sector to plan with more certainty and to help unlock the huge amount of long term private capital such as pension funds, that wants to invest in genuinely affordable homes.”
Justin Young, CEO of RICS, added: “This is a significant and welcome announcement from the government. For too long, the housing sector has lacked the long-term certainty needed to plan and deliver at scale. RICS has consistently called for an increase in public investment to match the ambition of building 1.5 million homes, and this 10-year programme does just that.
“RICS also welcomes the focus on developing the energy infrastructure required to support energy security and grid decarbonisation, supporting economic growth. Importantly, this commitment provides the clarity and confidence that local authorities and the wider built environment sector need to get construction started and to invest in the people, skills and materials that will make this ambition possible.
“We now need to ensure this ambition translates into action, with the right enabling conditions in place from a well-resourced planning system to a skilled a workforce. RICS and our members are ready to support the delivery of high-quality, affordable homes for communities across the UK.”
Industry response
Jason Honeyman
CEO, Bellway
“We’ve been caught in a cycle where developers are delivering affordable homes, but due to underfunding, our housing associations have limited financial capacity, leading to a reduced appetite to acquire. The government’s decision to confirm a 10-year rent settlement and double its investment brings much-needed certainty for developers and, crucially, unlocks high-quality homes delivered through section 106 – ensuring they reach the people who need them most.”
Olivia Harris
CEX, Dolphin Living
“The significant increase in investment to unlock more affordable housing, along with measures to provide greater long-term certainty to the sector through the 10-year rent settlement, are clearly very welcome. Taken together they will enable affordable providers to increase delivery. However, as ever the devil is in the detail and we need to ensure that much of this investment is directed towards London, where the need is most acute, and it is most expensive to deliver new affordable housing. In addition to funding, we need to see greater flexibility on affordable tenure, not just social rent, to ensure that local housing needs are met, and viability can be improved to unlock previously stalled schemes.”
Justin Carty
Executive director, residential investment advisory, CBRE
“Today’s announcement that £39bn is being allocated to affordable housing is a much-needed injection for the sector. This, alongside the announcement of a long-term rent settlement, should be the catalyst for unlocking and driving forward affordable housing delivery. The sector has faced a myriad of challenges, that has seen affordable housing delivery, particularly in London, stall, and there are still significant planning and delivery challenges that developers are facing, which need to be overcome to meet housing needs. This announcement is an excellent boost for the sector and a positive step forward.”
James Dickens
Managing director, Wavensmere Homes
“The £3.9bn per year confirmed in today’s Spending Review for social and affordable housing is welcomed. We hope this will provide a much-needed end to the inertia in the affordable housing sector, which is down to so few investments having been announced by Homes England over the past 12 months.”
Nicholas Harris
Chief executive, Stonewater
“It’s clear that the government still has some big fiscal challenges to navigate. But few issues are more important than fixing the housing crisis and making sure people have access to safe, affordable homes. There are currently far too many individuals and families stuck on housing waiting lists. Not having a stable place to call home can seriously affect a person’s prospects, wellbeing and overall happiness.
“It is hugely reassuring to see long-term funding for affordable homes of £39bn. This programme has been instrumental in helping Stonewater deliver thousands of much-needed homes across the country, including some developments with over 100 affordable homes. Support for this work must continue to give housing providers like us the confidence to plan long-term, invest in ambitious developments and deliver the homes communities urgently need.
“The new rent settlement at CPI+1 gives us much greater financial stability and certainty, which will be vital when planning our long-term investments and goals. This gives us an assured income stream and will unlock significant capital investment that will help us to deliver new homes and support existing customers. We sincerely hope that the Government stands by this settlement to provide much-needed certainty for the sector.
Will Maby
Partner, Rapleys
“What the affordable housing sector needed most from the Spending Review was certainty and funding. We got both of those and, whilst the funding wasn’t quite as much as what was called for, it represents a very real increase year-on-year for 10 years, and a boost to the delivery programme that was sorely needed. It will also make schemes more viable so that perfectly good schemes which couldn’t proceed under the current scenario due to the lack of of an RP partner should now be able to do so which will be a short-term acceleration in addition to the long-term delivery plans.
“The sector’s commitment to lobbying has paid off and this will inspire much more confidence by all stakeholders. As a result, we can now concentrate on getting affordable homes delivered and repaired, attracting private and institutional investment into the sector and ensuring the existing standing s106 units will be acquired by housing associations and mobilised quickly – all problems that were paralysing development that are now being addressed.”
James Barrett
Head of affordable housing, BNP Paribas Real Estate
“Today’s Spending Review delivers a powerful one-two punch for the UK’s housing crisis, placing planning reform and affordable housing squarely at the heart of the government’s growth agenda. Confirming a new 10-year £39bn Affordable Homes Programme is a significant step in the right direction towards transforming the fortunes of the social housing sector. This new programme amounts to £3.9bn of funding a year on average, which is a significant increase on the £2.5bn allocated under the existing programme, taking account of recent top ups.
“This certainty around the AHP comes on top of confirmation of a 10-year social rent settlement which will see rents rise at CPI+1% a year from 2026 and consultation will follow on how to implement social rent convergence. A longer-term rent settlement and rent convergence have long been fundamental asks of the sector and this news, coupled with the AHP certainty will kick-start a generational boost in the delivery of new social homes.”
Paul Rickard
Chief executive, Pocket Living
“The measures announced today by the chancellor are very welcome, especially the additional financial investments available to Homes England allowing enhanced financial support for our struggling SME housebuilding sector, alongside increased flexibilities within that funding allowing us to innovate together. This is a very positive step forward following other recent measures to support SMEs which we have been working closely with government on.
“The announcement of a 10-year £39bn affordable housing funding and rent settlement also provides much-needed clarity and capacity for the housing sector which should see a step change in the delivery of affordable housing. We hope to see greater flexibility on affordable tenure to improve viability and address local housing need on a site-by-site basis and to ensure that the positive work to improve the planning system and support our SME housebuilders is most effective, MHCLG, Homes England and local authorities will still need the day-to-day financial resources necessary to capitalise on the positive announcements to date.”
Richard Cook
Senior director – economics, Pegasus Group
“If the government is to meet its ambitious housing targets, action is urgently needed to support local authorities to start building more homes. Today’s £39bn for affordable housing provides a welcome boost to do exactly this – but the devil will be in the detail, and it is unclear whether this figure, which is to be spread out over ten years, will go far enough in reality.
“Additional investment in affordable homes is of course vital to meet housing targets, but we now also need to see action taken to tackle the skills gap in the construction sector, where hundreds of thousands of workers are urgently needed. Promises and commitments from the government are welcome, but we now need to start seeing action to start getting homes built: after all, meeting housing targets will be key for the UK achieving its growth plans.”
Colin Brown
Head of planning & development, Carter Jonas
“On the face of it, this is a very significant move by the chancellor to bolster the delivery of affordable housing and the sector will widely welcome it. It will help unlock sites, and aid the delivery of private housing as legal agreements typically seek to align the delivery of market and affordable housing. There remains a pressing need however to utilise some demand-side levers as well to encourage home ownership such as a return to Help to Buy. Of course, there are also ongoing concerns about local government funding and general skills availability to build the homes the country needs.”
Brendan Geraghty
CEO, Association for Rental Living
“The Association for Rental Living broadly welcomes the investment in infrastructure and a new Affordable Homes Programme announced today by the chancellor as part of the Spending Review 2025. Whilst no direct support for the build-to-rent sector was announced, we welcome the Government’s ongoing commitment to delivering the target total 1.5 million homes and the £39bn of funding for social and affordable homes which, together with build-to-rent, play an essential role in mixed tenure housing supply.
“The rental living sector will only grow and thrive due to the social and physical improvements intended in this Spending Review and the sector is ready to play its part in facilitating that change by providing high quality, professionally managed homes for rent across the country.”
Helen Collins
Principal, managing director Midlands, national head of affordable housing, Avison Young
“A £39bn Affordable Homes Programme and a 10-year rent settlement is a game changer – this is the first ever 10-year grant programme. Long term certainty creates the platform for driving real momentum in affordable housing and housebuilding generally. Critically, it should unlock more private capital for affordable housing and then overlay LGPS reform, and we have the ingredients for place-based investing at scale. Rent convergence, if reinstated, will unlock further capacity for building new homes.
“With declining SME builders and a shortage of construction workers early action at pace and scale is needed to train a new generation of construction workers to deliver on the ground. Clarity over Homes England’s future role and ability to provide low-cost funding to support SMEs is key – without it we’re limiting the system’s ability to deploy the capital that can now be leveraged at scale. If housing is to drive growth and unlock regeneration, then the institutions delivering it must be equipped to act with pace and purpose. This Spending Review sets the tone, now it’s about delivery.”
Emma Humphreys
Partner, Charles Russell Speechlys
“Given the recent dip in new homes receiving approval, there are serious concerns about an even tighter housing supply. Serious change is needed but it is unclear whether the proposed additional government spending will achieve that – given the continuing obstacles to development and absence of any government support for first-time buyers. There is also the consistent issue of what “affordable housing” means and whether it will really give families the homes they need.”
Neil Kelly
Head of land & development, Bidwells
“It is a relief to see the government allocate capital funding towards the delivery of affordable and social housing, which are both chronically undersupplied but also vital components of the housing jigsaw. A key question is whether the funding will be available for use on affordable housing delivered through Section 106 agreements.
“If not, the impact of the funding will be severely limited, as it won’t actually make any impression on resolving the current delivery issues faced on the ground, primarily in regard to the lack of registered providers’ appetite to acquire the S106 units, leaving open market delivery stymied.
“The government should also look to provide more support across a range of tenure types to address the crisis at multiple levels. In the market sale sector, for example, housebuilders are struggling to accelerate delivery due to mortgage un-affordability, inflation, and challenges around viability.”
Sarah Rowe
Partner and head of social housing, Freeths
“What has been announced today is a 50% uplift on the size of the previous programme and for the first time in living memory will provide 10 years of certainty. This alongside the rent settlement at CPI+1% for the same period is the long-term reliable subsidy that the sector has been calling for, for a long time. The devil as always will be in the detail in terms of grant rates, whether there will be a focus on social rent, where the shortage is acute, or any monies available for S.106 units where the market is in dire straits which is ultimately having a knock-on effect to the overall delivery of housing.
“The hard work begins now. Securing the partnerships needed to support the delivery afforded by the Affordable Homes Programme will be key to this. Partnerships was a key topic at UKREiiF a couple of weeks ago and I am sure will be on the agenda at Housing 2025 at the end of June.”
Peter Tooher
Executive director, Nexus Planning
“The near doubling of the Affordable Housing Programme, and the commitment to a 10-year programme, will go a long way to addressing the core viability and confidence concerns that have hampered affordable housing delivery in recent years. The industry needs to make this work, and drive up the delivery of all homes of all types that is hampering sustainable growth and the life chances of many young people.
“It will be interesting to see how the emphasis on social rent will influence the shape and location of affordable delivery. The planning sector will need to step up and work with affordable housing partners to take on this challenge of comparative riches, using the new tools at its disposal to create a long term pipeline of mixed housing sites – in towns, cities and the grey belt.”
Barbara Brownlee
Chief executive, Soho Housing
“Housing associations across the country will be welcoming the government’s £39bn commitment to social and affordable housing with open arms today. It is fantastic to see this government backing up its promises to the sector with real funds and policy commitments.
“This significant injection of funding, coupled with a 10-year rent settlement policy, exhibits the kind of long-term thinking and commitment housing associations so desperately need from this government. The industry has been neglected for too long, fobbed off by short-term solutions and empty promises. It is a relief to see affordable housing finally front and centre of the government’s fiscal agenda.
“In particular, the 10-year rent settlement will give housing associations the stability needed to develop long-term spending plans, which take into account refurbishment of existing stock and facilitate new building. It is also promising to hear government plans to launch a consultation on how to implement social rent convergence, which can’t come soon enough for the sector. We look forward to seeing words turn into action and this funding and policy commitment deployed to help residents on the ground and alleviate pressures on the industry.”
Elle Cass
Chartered town planner, SLR Consulting
“£39bn is no small fee, it’s the single biggest commitment in today’s Spending Review and marks a clear shift in tone from the government. Compared to the last administration, this represents almost a 50% uplift in annual affordable housing investment. It shows real intent, a willingness to borrow for growth, and an understanding that stimulus is essential, something the US proved in the wake of the last financial crisis.
“But while the funding headline is positive, there are clear gaps. There’s still no dedicated social housing grant to allow registered providers to acquire or build genuinely affordable homes. That’s a missed opportunity. We urgently need a national housebuilding programme, led by council housing, to meet demand, just as we did post-war. That requires structural reform, including serious investment in planning skills. Scrapping funding for Level 7 planning apprenticeships, for example, is a backwards step at exactly the wrong time.
“Raising social rents by 1% above inflation, as reported, is also deeply concerning. At a time when private rents are already unaffordable for many, that kind of increase risks pushing more people into hardship
Mark Powell
Managing director, EDAROTH
“The £39bn to fund the Affordable Housing Programme offers a once-in-a-generation opportunity to make a significant dent in the social housing challenge: this is a welcome reinforcement of the government’s commitment to social and affordable housing that could unlock innovation and rapidly increase the build rate of new homes.
“These plans follow recent proposals to simplify and speed up delivery for SME developers, including the use of innovations such as the small site aggregator tool, and we are optimistic that there will now be real momentum behind this commitment. The 10-year rent settlement guarantee provides real confidence for potential investors by offering long-term, government-backed opportunities. This will unlock the funding necessary to deliver the social and affordable homes that are needed to develop thriving communities across the country.
“Alongside this, the £10bn of financial investments will help to enable the private sector to deliver the new homes needed if we are to reach the 1.5million target within this parliament. We now look forward to further guidance from MHCLG on the specifics of how the AHP funding will be distributed.”
Sean Keyes
CEO, Sutcliffe
“Following the Spending Review, it’s evident that planning delays, escalating costs, and ongoing labour shortages continue to hinder progress across the UK construction industry. While infrastructure investment has been promised today, the lack of clarity around long-term delivery is causing widespread hesitation – putting the government’s 1.5 million homes target at real risk.
“Nevertheless, Rachel Reeves’ £40bn pledge of grants and commitment to affordable housing is a bold and encouraging step. Doubling investment signals serious intent to tackle the housing shortage and support communities. There’s no denying that it’s a major boost for the sector, however the approach must go further: either by ensuring local authorities and developers can turn funding into real homes or setting out a new, realistic pipeline underpinned by a clear placemaking framework – something Homes England has long championed.
“The industry urgently needs certainty and sustained commitment. While Labour’s plans are ambitious, questions remain over whether the party can stay the course amid mounting political pressure on spending. And while the direction is promising, whether the government hits its 1.5m homes target remains uncertain and will likely go down to the wire.”
Ruby Giblin
Partner, Winckworth Sherwood
“Today’s spending review gives housebuilders and social housing providers plenty to cheer. The 10-year rent settlement at inflation plus 1% is a bold and welcomed move that will provide certainty for social housing providers and funders. But for it to have real and lasting impact it must survive a possible change of government at the next general election, and that is not guaranteed.
“The consultation on rent convergence will be welcomed by social housing providers and local authorities. Social housing rents often reflect when a home was built, different rent policies and changes in subsidies, meaning rents can vary enormously for homes of the same size and in similar locations. Addressing rent convergence will provide social housing providers significant additional revenues to develop new homes and buy up thousands of new units already built by private developers as part of their affordable housing commitments.
“Together with the £39bn Affordable Homes Programme, the government has made clear that is serious about new and affordable homes across the UK. However, as with all significant government announcements, the devil will be in the detail. What, for example, will today’s announcement mean for those with shared ownership tenures.”
Daniel Austin
CEO and co-founder, ASK Partners
“The chancellor’s commitment of £39bn to affordable and social housing is a long-overdue but hugely welcome intervention. This funding, if deployed effectively, could mark a turning point in tackling the UK’s deep-rooted housing crisis. Crucially, investment must now be matched by urgent planning reform, proper resourcing of local authorities, and meaningful support for SME housebuilders.
“Labour’s target of 300,000 homes a year has been pledged before but never met. To succeed, this government must take bold, pro-growth steps, freeing up brownfield sites, embracing technology in planning, and ensuring lenders support a broader range of borrowers. Significant investment in transport networks will encourage developers to build near new transport hubs, while more social housing will take pressure off the private rented sector and help balance out prices.”
Jack Burnham
Head of affordable housing, Octopus Capital
“We welcome the government’s £39bn commitment to affordable housing over the next decade, alongside the introduction of a 10-year rent settlement set at CPI +1%. This is a positive and pragmatic move that supports the scale-up of affordable housing delivery across the UK – and aligns closely with the priorities of long-term institutional investors.
“The announcement effectively doubles the level of annual grant funding, from around £1.5bn to almost £4bn per year. As a fund and registered provider that already receives Homes England grant, we see first-hand the impact this support has in enabling the delivery of genuinely affordable homes. The increased allocation will allow us – and others – to bring forward more projects, in more places, at rents that are sustainable for residents and communities.
“The 10-year CPI +1% social housing rent settlement from 2026 provides welcome long-term policy stability. For investors seeking secure, inflation-linked income over multi-decade horizons, this gives a robust and transparent framework that enhances the resilience and predictability of returns. It strengthens the case for affordable housing as a core component of modern social infrastructure portfolios.”
Nicola Gooch,
Planning partner, Irwin Mitchell
“The spending review has treated planning and development with a slightly odd mix of generosity and restraint. On the one hand the Treasury has announced significant investments in social housing, transport and nuclear energy projects – which will be well received. On the other hand, day-to-day departmental spending remains tight. Which will be unwelcome news for local planning authorities who need to simultaneously grapple with ongoing planning reforms and local government reorganisation.
Investment in social and affordable housing is extremely welcome.
“The current lack of demand from registered providers for section 106 affordable housing is a real barrier to delivering consented housing sites. If the government is to have any hope of getting close to their target of 1.5 million homes by the end of the parliament, then a strong affordable housing sector is essential. However, LPA resourcing issues have not gone away and the further changes to planning fees proposed by the Planning and Infrastructure Bill are some way off being delivered.
Dave Seed
Managing director, Qube Residential
“Rachel Reeves’ Spending Review brings a mix of challenges and cautious opportunities for landlords. Regulatory changes and potential tax adjustments, such as those proposed in the Renters’ Rights Bill, are increasing pressure, while rising costs continue to squeeze already tight margins. Now more than ever, a strategic and forward-thinking approach is essential.
“Landlords must strike a difficult balance – maintaining property standards, supporting tenants, and protecting profitability. While the outlook remains uncertain, targeted infrastructure investment and progress towards the proposed 1.5 million new homes could open up areas of growth. We remain committed to helping landlords navigate an increasingly volatile market – one that faces yet another shift, despite earlier assurances from Keir Starmer that there would be no additional budget announcements.
“That said, allowing social landlords to raise rents 1% above inflation is a sensible move. It reflects economic reality, supports long-term viability, and gives landlords confidence to invest in building and maintaining homes.”
Trevor Wilkins
Managing director, PAH Building & Construction
“Energy efficiency and achieving the UK’s net zero target were key commitments made by the government at the last election. With the average annual energy bill set to rise to £1,849 in England this year, it is now a national priority to support more households in upgrading their properties. That’s why protecting funding for the Warm Homes Plan is the right decision. Cutting it would have slowed our progress toward net zero and made the government’s goal of reducing energy bills by £300 by 2030 far more difficult to achieve.
“Every home we retrofit today isn’t just more energy efficient, it’s also healthier and better prepared for the future in the face of our changing climate. The government must now turn words into action and deliver on its Warm Homes Plan commitment to drive economic growth, improve our housing stock and tackle fuel poverty.”
Tom Dodson
Chief operations officer, Better Green Living
“Labour must stop treating retrofit as an afterthought to new build property. With energy bills still high and the UK crippled with some of the oldest housing stock in Europe, retrofit should be at the top of the government’s agenda. Not only to support innovation in low-carbon energy solutions and improve our health, but to also unlock thousands of new green skilled jobs across the country.
“Students, renters and families or retirees are living in inefficient homes while retrofit programmes remain underfunded and fragmented. We need a bold, nationwide retrofit strategy backed by guaranteed funding and long-term targets. The government must focus on upgrading and electrifying the buildings people live in and work in today – not just on building shiny new developments.”
Wayne Douglas
Managing director, City & Country
“There has been a real sea change in attitudes towards housebuilding and housing delivery over the last 12 months, largely driven by the Labour government agenda. Already great strides have been made in unblocking the planning system and in direct measures to support SME housebuilders. Now is not the time to apply the brakes, or the government risks losing the momentum that it has built so far.
“The government needs to continue to push local authorities to approve schemes that provide much-needed homes and benefit local communities, and ultimately reducing the red tape that has restricted development for too long.
“We also need to be far more reactive to the wider economic pressures that inhibit buyers. For the first time in decades, there is no government support in place to assist first time buyers. Borrowing costs are still high, and stamp duty has pushed up costs for buyers. The government needs to enable reform for buyers at all levels, so that movement can take place at the top, bottom and middle of the market.”
Chris Harris
Chief operating officer, Dandara
“Today’s Spending Review delivers much-needed long-term commitments to infrastructure and housing, offering a critical opportunity to reform the systems that underpin delivery. The £39 bn investment in affordable and social housing is especially encouraging, signalling serious intent to tackle supply challenges across all tenures. For developers such as Dandara – who partner across the private, affordable, and single-family housing sectors – this provides a solid foundation for ongoing investment and collaboration.
However, to turn these ambitions into reality, the focus must now shift to delivery. Promising initiatives – such as deploying AI to support planning reform – will only succeed if backed by properly resourced local planning departments. Without sufficient capacity on the ground, even the most forward-thinking policies risk stalling.”
Omar Al-Hasso
CEO, SimplyPhi
“Social housing must be considered to be as vital to the government’s agenda as other major departments such as healthcare and defence. Today, the government has shown a significant commitment to affordable housing delivery, having announced a major £39bn Affordable Homes Programme and 10-year rent settlement, equating to £3.9bn of funding per year on average. The devil will be in the detail as to how this funding is allocated, but it is undeniably a historic move from the government which signifies a renewed faith in our industry.
“As of September 2024, over 126,000 households were living in temporary accommodation – up by a sixth from the year prior. Nine months later, no major progress has been made. The Government must act with speed and urgency to develop a long-term strategy to address this crisis, by increasing funding for local councils to prevent homelessness at the outset, working with institutional investor to provide suitable temporary accommodation for those at the point of crisis, and creating pathway to move households into sustained tenancies, into homes of their own.”
Craig Carson
Managing director, Barratt West London
“As housebuilders and developers, we need clear policy and funding that underpins the scale of homes required to meet the government’s target to build 88,000 homes in London and combat the lack of affordable homes in the capital. This is why we welcome the decision to inject £39bn into a new Affordable Homes Programme over 10 years, which is single-handedly the largest investment the social housing sector has seen.”
Sarah Jones
Chief executive, Anchor
“We are pleased to see the government’s commitment to affordable housing and look forward to a bold, deliverable national housing and planning strategy which should have a clear and urgent focus on homes for older people. Increasing the supply of homes for older people is essential to meet growing demand and to enable more people to live well and independently for longer. We look forward to working with the government to ensure future delivery meets the needs of our ageing population as part of the forthcoming housing strategy.
“Alongside the 10-year investment in affordable housing, the CPI+1% rent settlement and the consultation on rent convergence are welcome milestones and ones Anchor have been calling for. They provide greater certainty and confidence needed to boost investment in both new and existing homes, enabling providers to plan effectively and deliver high-quality, age-appropriate housing that our communities urgently need.
Tim Foreman
Managing director of land and new homes, LRG
“The additional funding for affordable housing is very welcome especially as the demand for affordable housing, and cost of building it, continues to increase. However, delivery of affordable housing would benefit from addressing a wider range of types and tenures than the government is currently providing for. Specifically, shared ownership plays a very important role in getting people on to the housing ladder and yet seems to have been largely ignored by this government.
“The popularity of shared ownership is increasing, partly because today’s first-time buyers are paying almost a third more to get on the property ladder than they were five years ago. Furthermore, in the last decade the number of private renters moving into home ownership fell by 23%. The government’s current stance on housing affordability – not least the increases in Stamp Duty and the freezing of Lifetime ISAs – has resulted in policies that are making it even harder for first time buyers to enter the market.
“Shared ownership deserves the same level of government-assisted marketing as benefited the now defunct Help to Buy scheme and it seems detrimental to the whole ‘growth agenda’ that the government is ignoring this important tenure.”
Jonathan Higgs
Chief executive, Raven Housing Trust
“Today’s Spending Review represents a landmark shift for housing. The government’s commitment to invest £39bn over the next decade, along with the framing of affordable housing as a core part of national renewal, is a bold and welcome step forward. It sends a clear signal that housing is not just a social priority, but an economic and environmental one too.
“For organisations like Raven, this provides the long-term confidence needed to plan, invest and deliver at greater scale – whether that’s building new affordable homes, retrofitting existing stock to meet net zero, or supporting communities to succeed. With rising demand for affordable housing in areas like Surrey and Sussex, today’s announcement creates new possibilities – notably more stable grant funding and the potential for longer-term rent-setting arrangements, which could unlock greater borrowing capacity to reinvest into homes and services.”
Dr David Crosthwaite
Chief economist, BCIS
“The housing sector is no doubt breathing a collective sigh of relief at the £39bn injection in the Affordable Homes Programme, and the £10bn assigned for crowding in private investments. The government has veered well off course on its new homes target so new funding brings further room for manoeuvre.
“That said, the government does not control housing supply. Housebuilders do. They are looking to maximise profit and therefore run a tight ship when it comes to maintaining the supply and pricing level of new homes. Building 1.5 million homes is still a big if. More funding over 10 years is a contribution, not a guarantee of delivery.”
Brian Yates
UK&I managing director, Stantec
“Through the substantial boost to the affordable homes programme, housing is correctly being recognised as essential to creating a more mobile labour market which in turn will support a more dynamic economy. We hope this grant funding can have a major impact on delivery and spur on wider regeneration across the country – helping to create more resilient communities. It is also positive to see Homes England looking at more flexible ways to crowd in private investment and support new development and we look forward to working with clients and partners to make the most of the new funding available.”
Eoghan O’Lionaird
Chief executive, Wates Group
“The announcement today of £39bn for affordable housing is a positive first step in helping to deliver at pace and scale the homes the country desperately needs. A 10-year funding horizon potentially is a game changer as it will unlock delivery and enable us to think bigger and act more boldly. Additionally, the £13.2 bn confirmed for the Warm Homes plan will have a major impact on improving the energy efficiency of our new and existing homes. Wates has long partnered with government, and we welcome the measures ministers are taking to improve the public estate, from the school rebuilding programme to dedicated funding for the removal of RAAC from classrooms and hospitals.
“Today’s announcements are beneficial for the construction industry, and we are pleased to see the government deliver on its commitment to publish a 10-year infrastructure strategy, thereby providing valuable long-term direction and certainty. This welcome commitment allows us to make major decisions around staffing and investment, matters of fundamental importance for our long-term strategy. It is also crucial in supporting investment in new technologies and the training of skilled workers – both of which will be essential to delivering the next generation of critical national infrastructure.
Paul Butterworth
Legal director in the affordable housing team, Foot Anstey
“The government’s seismic injection of £39bn into the UK’s affordable housing sector is a welcomed move. However, specific details on how this will materialise remain light. Past the headline figure, road blockers beyond purely public funding which link into delivery are still prevalent. Whilst encouraging, this investment is just one piece of the jigsaw in the issue of affordable housing delivery.
“Questions remain such as around whether Registered Providers have the financial and resource capacity to deliver the numbers even with this increased funding. The changes required to speed up delivery because of the number of moving parts is likely to take longer than anticipated. Whilst encouraging, the devil remains in the detail around this announcement and so doubts around the speed of hitting the government’s affordable housing targets remain.”
John Gravett
CEO, Cluttons
“Today’s striking announcement of an additional £39bn investment in affordable homes over the next decade, as well as billions in government backing to help attract private funding will be a very welcome shot in the arm for housing supply, although the full impact in terms of homes delivered may well be felt after the next election. The start of a new permanent mortgage guarantee scheme from July is another sensible move to ensure that buyers with smaller deposits are not excluded from the market.”
Ashley Wheaton
Vice chancellor, University of the Built Environment
“The chancellor’s reinforced commitment to delivering major infrastructure, housing and energy projects is welcome – but with 100,000 professional built environment workers needed annually to deliver these projects, the spending review may have missed a opportunity to help address this skills gap. It’s likely that we need to go beyond the £600m set aside for construction skills, and invest in technical and professional skills also. Take the £39bn allocated to the social housing as an example. It’s not only construction workers that are needed to get homes built – site supervisors, surveyors, building inspectors, safety officers and sustainability experts all have major roles to play.”
Damien Sharkey
Managing director, HUB Living
“We are encouraged by the government’s effort today to address the housing crisis in the Spending Review. The private sector has a crucial role to play, but we need to work together with government and this 10-year commitment is the kind of long-term thinking needed for that. If done right, this could be the beginning of a meaningful response to our housing crisis – so, now we must focus on creating genuinely sustainable homes and communities in neighbourhoods where affordable housing is delivered alongside private market homes.”
Jon Di Stefano
CEO, Greencore Homes
“Today’s announcement of £39bn of funding will go a long way towards transforming the affordable housing market and helping to get stalled sites moving again. While this will not deliver the scale of housing needed on its own, it is a welcome long-term commitment and another step in the right direction as part of the government’s determined drive to ease the housing crisis. It also comes hot on the heels of the deputy prime minister’s package of support announced last month for SME housebuilders at one of our sites in Oxfordshire.
“The 10-year rent settlement at 1% over inflation will also make a significant impact, and is exactly what housing associations have been asking for. Not only will this give housing associations and local authorities more income to help maintain existing housing, it will give them the certainty and confidence needed to invest in new housing.”
Stephen O’Malley
CEO, Civic
“Today’s announcements have come at a pivotal time for a government moving from plans and policy to investment and action, with the £39bn of affordable and social housing investment rightly in the spotlight as one of the big winners. However, building homes without the required infrastructure investment would derail any plans to “make working people in all parts of our country better off”. The allocation of £10.2bn for rail enhancements, while a drop in the ocean of the investment needed, is a critical step towards connecting the country.
“But it’s bigger than this. Infrastructure plays an enabling role in a bigger system, transforming landscapes in terms of suitability for housing and making sites viable to encourage private sector investment. The allocation of funding for social housing then gains a greater benefit as part of a wider eco system, mutually beneficial to achieving economic growth and prosperity.”
