“As we build a strong and secure and resilient economy, working people must feel the benefits. That starts with the security of a proper home.” Those were the words of the Chancellor Rachel Reeves yesterday as she announced the boldest plan for the country’s homes in a decade. A government ambition that clearly recognised home is the foundation of our lives, a place to build a family, work and be part of a community.
Affordable Homes Programme
The Nationwide Foundation recognises the scale and systemic ambition of the newly announced Affordable Homes Programme (thanks to the considerable efforts of Kate Henderson and her teams at the National Housing Federation). The £39 billion AHP (over 10 years) is not just a significant investment – it also signals a real commitment to addressing the structural undersupply of truly affordable homes and rebalancing the housing system in favour of those people who need the greatest support.
However, the programme still falls short of Shelter’s forecast that £30 billion to £38.2 billion should be earmarked for the first five years to meet demand at scale. That level of sustained investment is vital to provide both certainty and impact. Going forward, the AHP must sharpen its focus on social rented housing, alongside affordable and shared ownership options. This is essential to reduce the devastating impacts of families waiting years on housing lists; prevent more blighted childhoods spent in temporary accommodation and slashing the distorting use of private rented accommodation as social housing, or worse – supported accommodation, for our most vulnerable neighbours.
Giving housing associations equal access to the government’s building safety fund (alongside private developers) means that they can deliver both on remediation work for existing properties and increase access to affordable housing.
Transforming Homes England
The transformation of Homes England into a ‘housing bank’ with an additional £10billion in financial investment is critical. It signals an intention to fund and de-risk affordable housing at scale, while reducing reliance on market-led delivery models that often fall short on both volume and affordability. This move represents a long-term systems intervention not simply another funding cycle and, if well designed, could permanently alter how affordable housing is financed and built in the UK.
Housing units aren’t homes without public amenities, the parks, playgrounds and libraries that create good neighbourhoods. So, yesterday’s additional spending on the Plan for Neighbourhoods is promising.
Treasury changes the potential to improve infrastructure and deliver more affordable homes
News of changes to the rules of the Treasury’s ‘Green Book’, that oversee how major projects’ value for money are assessed, feels one to watch. It will allow for ‘place-based’ business cases, with officials hoping this will make investment outside of London and the South East easier. This must be good news for the necessary infrastructure needed to support housing delivery.
Possibly overlooked, was another piece of HM Treasury work – the social investment vehicle flagged in the Autumn Budget last year. The government is developing a social impact investment vehicle to support its ‘missions’ delivery and tackle social problems. Convening socially-motivated investors, philanthropists and social sector organisations and working across Treasury, the Office for Investment and the Department for Culture, Media and Sport, more details will be announced in the summer. We hope the housing crisis and the value of social/community-enterprise led solutions will feature heavily in the outcomes of the vehicle.
One of the most promising elements is the programme’s focus on reducing the cost of capital for affordable housing delivery, a major step toward long-term affordability. It enables providers to set social rents without cross-subsidy pressures, expanding access to housing for those most excluded from the market.
A new opportunity to diversify housebuilding
Housing delivery is dominated by a small number of large volume builders whose business models require shareholder return over social value. SMEs, housing associations, and community-led developers frequently struggle to compete not because their models aren’t viable, but because they can’t access finance on fair terms or secure land fast enough.
The creation of a housing bank changes that. With the right design, this model can level the playing field, offering tailored finance to smaller and community-based developers who often deliver more affordable, locally appropriate, and sustainable homes but have historically been sidelined by mainstream funding systems. Supporting these actors isn’t just about fairness; it also supports to build resilience, innovation, responsive and equitable housing system. This – coupled with the Chancellor’s support for small businesses – including SME builders – has a real opportunity to expand our country’s developer market and help supercharge much-needed delivery.
That’s said, the absence of mutuals and co-operatives in the budget was disappointing for community-led housing, particularly given the Government’s manifesto pledge to double the size of the sector in this parliament.
A great leap forward
As many have already said – amongst the plaudits for the focus on addressing the housing crisis – there are enormous budget lines across this Spending Review. The renewal plan is bold, ambitious and squarely focused on growth to fund the ambition. Taxation is the obvious next question and for the Foundation, should the potential of domestic property taxation and reform be a future consideration?
The raft of housing announcements that preceded the Comprehensive Spending Review (possibly in lieu of the long-term and awaited housing strategy?) reflects the “everything, all at once” urgency long called for by the housing sector. Achieving decent and affordable homes for all takes everyone pulling in the same direction. In a system as complex as housing, the CSR 2025 takes a great leap forward.
The full Spending Review can be found on the government website.