First tranche of a £39bn housebuilding programme targets six English regions, with 60% of new homes designated for social rent
The government has confirmed the initial allocation of nearly £10 billion from its £39 billion Social and Affordable Housing Programme (SAHP), earmarking funding for more than 70,000 homes across Greater Manchester, the West Midlands, West Yorkshire, South Yorkshire, North East England, and Liverpool. A further £6 billion had previously been announced for London.
The allocation represents the first phase of a wider commitment to deliver 300,000 social and affordable homes by 2039. At least 60% of the homes in the first tranche will be designated for social rent, which is typically priced at roughly half of market rates.
Prime Minister Andy Burnham, who prior to taking office had publicly argued that the entire £39 billion budget should be devoted to social rent, announced the package. "Councils built this country out of a housing crisis once before," he said. "Backed properly, and trusted to get on with it, they will do it again."
Housing minister Matthew Pennycook told the BBC that the government had taken a "pragmatic approach" and was seeking to "get money out the door", adding that subsequent tranches would place greater emphasis on council housing. More than £16 billion remains to be allocated outside London.
There isn’t a constituency advice surgery that passes without a local family coming to me in desperate need of a safe, secure, decent and affordable home of their own.
— Matthew Pennycook MP (@mtpennycook) August 25, 2026
In Greenwich alone, we have 29,000 people on the council’s housing waiting list.
This Labour government has…
Housing secretary Angela Rayner has reaffirmed the government's goal of delivering 1.5 million homes by 2030, acknowledging that the target will be "challenging". The most recent data indicates that approximately 203,000 new homes were completed in England in the 12 months to June 2026, well below the 300,000 annual rate required to meet the target.
The programme arrives against a backdrop of sustained decline in social housing stock. Official figures show that the net number of social rent homes fell by 3,834 in 2024–25, driven in part by sales under the Right to Buy scheme and local authority disposals. In the decade to 2025, an estimated 180,067 social rent homes were lost in total. The government has announced reforms to Right to Buy, including extending the minimum eligibility period from three to ten years and restricting the sale of social homes built within 35 years.
On a more positive note, 12,198 new social rent homes were completed in 2024–25 — the highest annual figure since 2013–14 — and the National Housing Federation reported a 57% year-on-year rise in starts on social rent homes.
Charities cautiously welcomed the announcement but warned that current ambitions fall significantly short of what is needed. Organisations including Crisis and Shelter have estimated that 90,000 social rent homes per year — roughly 900,000 over a decade — would be required to reverse the decline. The government's SAHP target of 180,000 social rent homes by 2039 is less than a quarter of that figure.
Approximately 134,000 households, including over 176,000 children, are currently living in temporary accommodation, while more than 1.3 million households remain on local authority waiting lists for social housing.
The announcement was also welcomed by housebuilders. Shares in Vistry rose more than 12% in early trading, while Barratt Redrow and Persimmon led gains among FTSE 100-listed housebuilders.
Conservative shadow housing secretary Sir James Cleverly described the package as "sleight of hand", noting that "the small print shows homes won't have to be delivered until 2039." Liberal Democrat housing spokesperson Gideon Amos said the plan for more social rent homes "won't cut it" and that a programme is needed that "meets the scale of the challenge".
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