5 things we learned from the London Social and Affordable Homes Programme 2026-36 guidance

New Key Worker Living Rent product

On the new key worker product, the GLA will publish borough-level benchmarks, based on 40% of the average net household incomes of London’s key workers and further adjusted to take into account local market rents.

Rent levels, inclusive of service charges must be set at or below these benchmarks when providers first let a home. These benchmarks will then be updated annually.

After letting a Key Worker Living Rent home for the first time, providers may increase rents, inclusive of service charges, annually by up to the Consumer Price Index plus 1%.

When a home comes to be re-let, providers do not need to reset rents to the benchmarks that are set out. However, they may only increase rents up to a maximum level.

Levels will be set out in the forthcoming practice note on Key Worker Living Rent homes, which will be published by the GLA shortly.

Sir Sadiq Khan, mayor of London, said: “I fully support the government’s national target that at least 60% of homes delivered under this programme will be for social rent.

“We will also support the delivery of new shared-ownership homes, intermediate-rent homes and London Living Rent homes, including a new tenure linked to the income of the key workers that keep London moving.”

Intermediate rents

Alongside the new Key Worker Living Rent product, the funding will be able to support an “intermediate rent in perpetuity” product for Londoners who are unlikely to secure social rented housing or struggle to cover the costs of renting privately.

This includes those who cannot afford to purchase a home, either through shared ownership or outright.

Rents, inclusive of service charges, should be affordable to households with incomes below the income threshold for intermediate rent set out in the London Plan.

This means that these costs should not exceed 40% of the net amount of the income threshold for intermediate rent.

They must be at least 20% below market level as per the National Planning Policy Framework, though the mayor expects intermediate rents to be at a greater discount than this.

The intermediate rent in perpetuity products funded under this programme will not be considered Rent to Buy products. Therefore, there is no requirement or expectation on providers to sell them to residents on a shared-ownership basis or outright.

The mayor added: “These intermediate products will support Londoners who are unlikely to ever access social rented housing, but who are struggling to cover the costs of a home that meets their needs on the open market.

“This programme will be the main way that we can deliver supported and specialist housing, helping to meet the diverse housing needs of Londoners. Fixing the housing crisis in London is a huge challenge, but it’s one I’m determined to take head-on so that we can deliver the homes Londoners need and continue building a fairer London for everyone.”

Combustible material ban and fire suppression

London’s SAHP “will not permit the use of combustible materials in newly built developed buildings of all heights funded through the programme”.

On building safety, the GLA provided further detail on the ban. The definition of combustible material, and the exemptions tolerated, are set out in Building Regulations 7(1), (2) and (3) only. The definition of “relevant building” detailed in Regulation 7(4) does not apply. 

This ban does not prohibit buildings with timber frames, as long as there is no combustible material (such as timber) present in the external wall.

For acquisitions, refurbishments and remodelling, and permitted development projects, providers will need to undertake reasonable endeavours to assure that there are no combustible materials in the external walls. 

In certain circumstances, it will be sufficient for providers to provide a fire risk appraisal of the external walls using PAS 9980:2022 methodology, that declares the risk posed by the external wall is sufficiently low to not warrant remediation works.

It will also require providers to install automatic fire suppression systems in newly built buildings of all heights – with the exception of houses and buildings similar to houses.

Specialist and supported housing

This type of housing will include transitional supported housing for people in crisis, or with temporary support needs, and long-term supported housing for people with enduring or lifelong support needs.

This is in addition to older people’s supported housing for those aged 55 and over with support or care needs, specialist homes designed for specific communities or needs without support, and Gypsy and Traveller sites and pitches.

These schemes are expected to prioritise social rent levels but the GLA also funds supported and specialist homes at other tenures, including at affordable rent levels, if it is essential for viability reasons, and where providers can demonstrate that the homes are affordable to the relevant client group.

The GLA is also keen to understand the demand for projects that deliver older persons’ shared ownership, and home ownership for people with long-term disabilities.

For this housing, the GLA will also permit shorter lease lengths for specialist and supported housing schemes – compared with general needs – where this is essential to unlocking delivery.

Providers are particularly encouraged to deliver specialist and supported housing for client groups to address urgent, unmet needs. This includes needs evidenced in local plans, the London Plan and needs assessments for specialist housing.

For Gypsy and Traveller communities, the GLA  intends to publish an updated London-wide needs assessment by the end of 2025.

Alternative delivery routes

The GLA has set out other routes to delivering social and affordable housing targets under its funding guidance, which includes funding to convert a limited number of unsold completed new-build market homes to affordable housing.

Similarly, the cash can be used to acquire a limited number of existing market homes. This route is predominantly for the delivery of new social rent homes, and, for local authorities only, for the delivery of temporary accommodation.

For replacement homes on estate regeneration schemes, funding could cover both the need to replace a limited number of homes being demolished on estate regeneration schemes; and to deliver additional social and affordable homes on those schemes.

This funding will be subject to estate regeneration schemes delivering a net increase in affordable housing homes, and replacement homes will be restricted by overall programme limits.

On the refurbishment and remodelling of existing specialist and supported stock, funding will be provided in expectational circumstances to providers to refurbish and/or remodel a limited number of existing specialist and supported homes.

Inside Housing set out five things we learned from the wider SAHP prospectus last week, and has the sector’s initial reaction here.