Affordable Housing:
The need for subsidized housing has long been recognized. The cost of private sector housing of acceptable standards, compared with the level and distribution of incomes and assets, means numerous households lack the means to make demand for decent housing effective in the market. Without subsidized housing, these households may fail to obtain housing of a decent standard.
The most commonly referred to definition of affordable housing is set out in Annex 2 of the National Planning Policy Framework (NPPF). This is the definition used by local planning authorities when making provisions within their areas to meet local demand and needs for affordable housing. The NPPF definition incorporates social rent, as well as a range of intermediate rent and for-sale products. The Affordable Housing Commission (2020) concluded that “many” of these products “are clearly unaffordable to those on mid to lower incomes.”
The NPPF says where major development includes the provision of housing, at least 10% of the housing provided should be for affordable home ownership, subject to some exceptions. There is no minimum level of provision of affordable rented housing–this is for local planning authorities to determine.
There are concerns that planning measures in the Levelling-up and Regeneration Bill, which is currently before parliament, would have an adverse effect on the delivery of affordable housing through the planning system. The Government has repeatedly said it is committed to delivering “at least as much, if not more, on-site affordable housing” as under the current system.”
Commentators increasingly refer to a crisis of affordability in England. In the foreword to the June 2017 IPPR report, What more can be done to build the homes we need?, Sir Michael Lyons said: “We would stress that it is not just the number built but also the balance of tenures and affordability which need to be thought through for an effective housing strategy.”
Homeownership has been difficult to access in recent years, particularly for first-time buyers, while access to social housing is constrained by limited supply. The private rented sector has benefited, it now houses more households than the social rented sector. Private sector rent levels in high-pressure areas have increased in response to demand. One Government response has been to restrict assistance through Housing Benefit and the housing element of Universal Credit. Analysis by Crisis (2022) found “housing benefit is no longer covering the cost of renting a modest property in most parts of England”.
Historically, homes for social rent (with rents at around 50-60% of market rents) and affordable home ownership have been the main source of new affordable housing. The introduction in 2011 of social sector units with rents of up to 80% of market rents has, in the view of some commentators, undermined the ability of even the social sector to supply housing that is truly affordable.
The 2021-26 Affordable Homes Programme (AHP) program is allocating £11.5 billion of grant funding over five years. This is expected to support up to 180,000 new homes, subject to economic conditions. The program’s funding was to be split: 50% to fund homes at a discounted rent, and 50% for affordable home ownership products, but in February 2023 the department announced social rent was “a priority for the fund” meaning social rent specific grant rates could be accessed in all parts of the country.
The 2021-26 Affordable Homes Programme (AHP) program is allocating £11.5 billion of grant funding over five years. This is expected to support up to 180,000 new homes, subject to economic conditions. The programme’s funding was to be split: 50% to fund homes at a discounted rent, and 50% for affordable home ownership products, but in February 2023 the department announced social rent was “a priority for the fund” meaning social rent specific grant rates could be accessed in all parts of the country.
There are widespread calls for increased support to develop more social rented housing. Cited benefits include the potential to reduce pressure on Housing Benefit/Universal Credit expenditure and improved housing options for people on a low income without having to rely on benefits help.