How to make the most of the Social and Affordable Homes Programme

To take advantage of this, housing associations must find sites which can progress quickly. Most sites that will provide completed homes by this date are already in the planning system. Our analysis of Glenigan data since 2017 suggests that sites of 100-200 homes take an average of 6.3 years to progress from outline application to completion, meaning sites in the longer-term pipeline are unlikely to complete before the initial March 2029 deadline.

“Partnership arrangements are increasingly attractive to private developers, given the challenges around viability in development, slowing sales rates in the private market and the funding opportunity available to housing associations”

Housing associations will need to engage in partnerships to maximise this near-term opportunity, because most sites in the near term pipeline are owned by a party who will develop themselves – 66% of homes with full permission are controlled by developers or housing associations, for example.

Partnership arrangements are increasingly attractive to private developers, though, given the challenges around viability in development, slowing sales rates in the private market and the funding opportunity available to housing associations. Understanding who the key private developers are who own sites in the local pipeline will be crucial for housing associations looking to build partner relationships.

The second key opportunity lies in the longer-term nature of the SAHP. The final deadline to start homes under the programme is the end of March 2036, giving housing associations a full decade to promote and deliver sites which aren’t currently in the planning system.

This opens up another host of land opportunities for housing associations which may not have been possible within previous five-year programmes. But given the speed of the planning and development process, housing associations should start thinking now about their longer-term plans, to ensure they can secure sites efficiently and maximise the value of having a longer-term funding settlement.
Sites further from completion offer more chances for housing associations to deliver homes independently, because they are less likely to already be owned by parties who will develop themselves. Just 47% of homes at outline permission are owned by developers, leaving 390,000 homes at this stage (and 800,000 homes in the planning application process overall) owned by land promoters, investors, public sector bodies and other parties who are likely to sell the site to a developer.

“Given the speed of the planning and development process, housing associations should start thinking now about their longer-term plans to ensure they can secure sites efficiently and maximise the value of having a longer-term funding settlement”

Housing associations can bid for these sites, but will be competing in a relatively constrained land market. Many house builders will also be looking for smaller sites (50-150 homes) that can deliver in a relatively short timeframe to boost their outlet numbers while sales rates remain constrained, but this type of site is in short supply.
Housing associations with land promotion capabilities can also look to sites yet to enter the planning process. Our analysis of Landstack data suggests there are 1.71 million homes on adopted allocations and 1.94 million homes on draft allocations nationally which are yet to enter the planning application process.

Over this longer period, the housing market fundamentals and the robustness of future demand are key considerations housing associations should take into account when choosing where to build homes.
Dan Hill, research analyst, Savills Residential Research