Housing associations and house builders call for Affordable Homes Programme extension as development stalls

Southern Housing told Social Housing that higher grants and greater flexibility in how they are used are “crucial for stemming the reduction in affordable housing delivery” and an extension to AHP schemes is required.

 

“To deal with contractor and regulatory delays it’s vital for our current delivery that there’s an extension to the completion deadline in the 2016-21 and 2021-26 programme, which would enable us to continue to deliver high-quality, affordable homes,” a spokesperson from the G15 landlord said.

 

Paul Fiddaman, chief executive of Karbon Homes, said that he welcomes the £500m top-up to the AHP, but greater flexibility on timescales with a longer deadline for this funding “may help overcome any interruption in programme delivery”.

 

“We welcome the additional £500m top-up, which should enable some stalled sites to be brought forward, but we would welcome greater flexibility on timescales,” he said.

 

“What will really turn the dial and enable the sector to scale up development is a new Affordable Homes Programme on a much bigger scale. However, there is a risk that the timing of the next programme will lead to some delay in bringing forward new schemes as the sector awaits confirmation of the funding that will be available.

 

“A longer deadline for the top-up funding may help overcome any interruption in programme delivery.”

 

Helen Shackleton, head of growth at CHP, said that if the current 2021-26 AHP was extended so that there was an overlap with the new scheme, this would assist in the planning and delivery of affordable homes.

She said: “The additional £500m top-up is welcome as it will provide Homes England additional funding capacity for schemes that are at the stage where work can start on site. Homes funded through the current 2021-26 programme are required to start on site by 31 March 2025 and complete by 31 March 2026. Meeting these timeframes will be the challenge.

 

“We are waiting for Homes England to confirm what the focus and priorities will be for the next Affordable Homes Programme, that will follow on from the 2021-26 programme. The sooner this information is available, registered providers will know what type and tenure of schemes they need to focus on, and this will shape their development programme. 

 

“We are not expecting an announcement on the next Affordable Homes Programme until spring 2025. If the current 2021-26 was extended so that there was an overlap, this would assist in the planning and delivery of affordable homes.”

 

Ryan Mitchell, managing director of residential property development company Greenstone, also highlighted the issue of new developments stalling due to the timescales of AHP grant windows.

 

“This is a major issue for the industry,” he said.

 

Rupert Harrison, a trustee at AG Homes, said the house builder has a number of larger schemes that are presently stalled as it cannot secure the necessary grants to start.

 

“There’s a big issue here,” he said.

 

“The government needs to extend the existing AHP programme 2026 until such time as the new scheme is released. You cannot announce a £1.5m delivery of new homes and then effectively stop any delivery in its track because you do not have an active grant programme.”

 

In addition, one sector source told Social Housing: “It’s unrealistic to think RPs would be working up and starting on site on pipeline opportunities prior to the assurance of grant.”

 

A spokesperson from the Ministry of Housing, Communities and Local Government said that this government will “work in partnership with housebuilders and increase their capacity so we can we hit our ambitious housing targets, including the biggest increase in social housing and affordable housebuilding in a generation”.

 

“We will set out details of new investment to succeed the 2021-26 Affordable Homes Programme at the multi-year Spending Review next year,” the spokesperson said.

 

The government has previously been warned about the impact of a lack of grant certainty on development.

 

City Hall and London Councils set up the 2023 Housing Delivery Taskforce between August and September 2023 to identify the interventions needed to safeguard the delivery of homes in London.

 

In November last year the taskforce warned that the lack of certainty of grant beyond March 2026 risked stalling delivery.

 

However, in July this year housing secretary Angela Rayner said in Parliament that ministers have agreed new flexibilities with the Greater London Authority for their AHP to enable them to unlock delivery in London, which included an extension to the deadlines for homes completing.

 

“In London, there have been significant delays, including from changed regulations on building safety and many other pressures, which mean that even existing contracts are at risk of falling through because they are no longer deliverable under the current terms,” she said.

 

“We have therefore agreed with the Greater London Authority new flexibilities to the existing programme so that they can unlock delivery in London, with changes to deadlines for homes completing and tenure mix to enable some intermediate rent homes.”

 

The London Assembly Housing Committee, which examines matters relating to housing in London and leads on the scrutiny of the Mayor’s housing responsibilities, agreed with the previous government that most developments for the AHP 2021 to 2026 would be completed by March 2028, with some strategic sites completing by March 2029.

 

In summer 2024, the Greater London Authority and the current government agreed “flexibilities” to the AHP 2021-26, which included an extended completions deadline to 31 March 2030.