The government has unveiled the first major funding package from its £39 billion Social and Affordable Homes Programme, promising a significant expansion of council housebuilding and
thousands of new homes for families struggling to find secure accommodation.
Nearly £10 billion is being allocated in the first round of investment, supporting plans for more than 70,000 social, affordable and council homes across England. The funding will be distributed among 33 Strategic Partners, including local authorities, housing associations and other organisations capable of delivering large-scale housing programmes.
The announcement represents a renewed effort to put councils back at the centre of England’s housing supply after decades in which local authority housebuilding declined sharply.
The government says around 60% of the homes delivered through the new strategic partnerships are expected to be offered at Social Rent — the lowest-cost mainstream form of rented housing. The priority is to help households facing long waits for council accommodation and families living in temporary housing.
With almost 180,000 children currently growing up without a permanent home, ministers argue that increasing the supply of genuinely affordable housing is essential to tackling the wider housing crisis.
Councils return to the heart of housebuilding
The programme is designed to give councils a greater role in determining where and how new homes are built. Local authorities will be able to become Strategic Partners of Homes England, giving them access to longer-term funding and placing them alongside housing associations in the delivery of major developments.
Prime Minister Andy Burnham said the scale of the housing challenge required a return to the kind of council-led construction that helped address housing shortages in previous generations.
He said no child should have to grow up in temporary accommodation and no family should have to spend years waiting for a permanent home.
Burnham argued that councils had previously demonstrated their ability to respond to housing crises by building at scale and could do so again if provided with the necessary financial support and freedom to act.
Housing Secretary Angela Rayner said access to a secure home could fundamentally change the prospects of families facing housing insecurity.
Drawing on her own experience of the importance of having a safe home, Rayner said the government was determined to enable councils to resume large-scale construction and help households move out of temporary accommodation.
Greater powers for mayors and local authorities
The investment also forms part of the government's broader programme of devolution, with greater responsibility for housing policy being transferred from central government to regional authorities.
More than £2 billion of the first funding package is expected to be invested in mayoral areas outside London. Established Mayoral Strategic Authorities will help determine local priorities and shape how housing investment is deployed.
Ministers say the approach is intended to ensure decisions about housing reflect local needs rather than being determined entirely in Whitehall.
Further funding is expected to move directly to mayoral authorities as the ten-year programme progresses.
More than £16 billion of the programme remains to be allocated outside London. The government has indicated that future rounds will place particular emphasis on Social Rent properties and council-led construction.
A major push for council housing
The scale of the programme is intended to reverse a long-term decline in council housebuilding.
Local authorities once played a central role in providing affordable housing across England, but council construction fell substantially over successive decades. The government now wants councils to become major housebuilders again, with the programme described as the largest expansion of council housing in decades.
To help authorities overcome shortages in technical expertise and development capacity, the government is providing an additional £46 million over three years.
The money will be used to strengthen councils’ housing teams, improve development expertise and help authorities prepare and deliver larger building programmes.
Councils will also be encouraged to make greater use of Right to Buy receipts. Local authorities raised £1.61 billion from Right to Buy sales during the last financial year, and ministers want a larger proportion of available resources to contribute towards new housing.
London faces particular pressure
London will receive a substantial share of the wider housing investment because of the capital’s severe shortage of affordable accommodation.
The Greater London Authority plans to offer at least £6 billion through the programme. Councils are expected to deliver more than half of the homes supported by the funding in the capital.
The government says London already demonstrates the benefits of giving local and regional leaders greater control over housing investment, allowing decisions to be more closely aligned with local housing demand.
Homes England to support delivery
Homes England, the government's housing and regeneration agency, will work with councils, mayors, housing associations and other local partners to turn the funding commitments into new developments.
Its chief executive, Amy Rees, said the first allocation marked an important stage in delivering the £39 billion programme and could help unlock thousands of homes that are urgently needed across England.
She said collaboration between central government, local authorities and regional leaders could accelerate the return of council housebuilding at scale while increasing the number of Social Rent properties.
The agency will also use other investment mechanisms, including the National Housing Bank, to support housing development and help create new communities.
First stage of a decade-long programme
The £10 billion package announced this week represents only the beginning of the government's ten-year housing programme.
The central objective is to increase the number of homes that families on lower incomes can realistically afford while giving councils a stronger role in deciding where new housing is needed.
For households living in temporary accommodation, on lengthy waiting lists or facing increasingly unaffordable private rents, the success of the programme will ultimately be measured not by the size of government allocations but by how quickly new homes become available.
Ministers are betting that sustained public investment, stronger local decision-making and a revival of council housebuilding can help reshape England's housing system — and provide more families with something that has become increasingly difficult to secure: a permanent, affordable place to call home.
The Mayor of London, Sadiq Khan, said:
“Tackling the housing crisis is one of my top priorities and I’m doing everything I can to deliver more affordable homes that Londoners desperately need. We’ve built record numbers of council homes in London, but the number of families and children without a permanent home stuck on housing waiting lists is still unacceptable. I want to work with this new Government to deliver a step change in how many council homes we can deliver across the capital.
Thousands of Londoners will benefit from this new wave of new social and affordable homes, which will help people out of temporary accommodation and provide good, affordable homes to live in for the long-term, as we build a fairer, better London for everyone”.
