Affordable Homes Programme

1. The Affordable Homes Programme run by Homes England offers grant funding to assist with the capital costs of creating affordable housing options for rent or purchase.

Housing affordability crisis

2. The housing affordability crisis in the country has resulted in many households being unable to afford adequate housing, with 60% of those wanting to buy a home lacking the savings for a deposit. Additionally, a large number of households in the private rental sector are on housing benefits or waiting lists for affordable housing.

The AHP 2021-2026  programme

3. The AHP 2021-2026  programme aims at addressing the shortage of affordable housing in England. The program provides funding to boost the construction of new homes.

4. The program for the years 2021-2026 is making £7.39 billion available starting April 2021 to provide up to 130,000 affordable homes by March 2026, – in areas outside of London.

Homes for rent

5. The funded homes for rent fall into two categories:

  1. Social Rent – rented at below market value by a registered provider, with the rent determined by a formula based on local property values and earnings; and
  2. Affordable Rent -also rented at below market value by a registered provider, but with a rent (including service charge) set at up to 80% of local market rent for a similar home.

Home ownership

6. The funding for home ownership is for: 

  1. Shared Ownership,
  2. Home Ownership for people with Long-term Disabilities (HOLD),
  3. Older Persons Shared Ownership (OPSO), and
  4. Rent to Buy.

Supported housing

7. 10% of the homes delivered through the program are expected to be for supported housing. This refers to any housing scheme where accommodation is provided alongside care, support, or supervision to assist individuals in living as independently as possible in the community.

8. These homes can be developed through both new construction and repurposing/improvement of existing homes, with a Capital Funding Guide identifying the specific types of homes and target groups.1‘Capital Funding Guide – 3. Specialist Homes – Guidance – GOV.UK’,  accessed 14 January 2023  

Changes to the  AHP 2021-2026 compared to its predecessor

9. The AHP 2021-2026 has several changes compared to its predecessor, the AHP 2016-2023.2Milcheva S and others, August 2022, ‘Scoping Report for the Evaluation of the Affordable Homes Programme 2021-2026

10. One of the key differences is the inclusion of a new model of Shared Ownership, which allows buyers to purchase a smaller initial share of the property and increase their ownership in smaller increments.3Milcheva S and others, August 2022, ‘Scoping Report for the Evaluation of the Affordable Homes Programme 2021-2026

11. Additionally, most social and affordable rental units are now attached with a Right to Shared Ownership (RTSO) as a grant condition. The RTSO program is aimed at helping sub-market tenants become homeowners by allowing them to accumulate equity in their rental units.4Milcheva S and others, August 2022, ‘Scoping Report for the Evaluation of the Affordable Homes Programme 2021-2026

12. The new elements of the AHP 2021-2026 also include:5Milcheva S and others, August 2022, ‘Scoping Report for the Evaluation of the Affordable Homes Programme 2021-2026

  1. more defined targets for supported housing delivery,
  2. increased focus on modern methods of construction,
  3. rural housing,
  4. design,
  5. quality of delivery, and
  6. engagement with small and medium-sized enterprises and smaller housing associations.
Tags: England
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