A significant portion of affordable housing in rural England could be under threat if ministers proceed with plans to ease planning regulations for private developers. New analysis indicates that up to half of all new affordable homes in these areas might be at risk, potentially impacting thousands of families.
The government is currently reviewing proposals to discontinue the requirement for developers to include affordable housing, known as Section 106 agreements, in new developments comprising between 10 and 49 houses. Instead, developers might be allowed to make direct cash payments to local authorities, which would then be earmarked for affordable housing elsewhere. A final decision on these changes is anticipated within weeks.
However, the National Housing Federation (NHF), an organisation representing housing associations, has analysed government figures and found that in England's most rural areas, over 50% of all affordable homes are constructed within developments of this specific size. The NHF cautions that removing the existing requirement could lead to a shortfall of 32,000 affordable homes across the country over the next decade.
Kate Henderson, Chief Executive of the NHF, emphasised the existing challenges faced by rural families, who are often priced out of their local communities. She stated that these proposals risk exacerbating the rural housing crisis, potentially leading to longer waiting lists for housing, increased homelessness, and staff shortages in local services like schools and businesses. Section 106 agreements have become a crucial mechanism for delivering affordable housing nationwide, accounting for 36% of all such homes provided in 2024-25, particularly in the absence of extensive council housebuilding.
Ministers have expressed concerns that current Section 106 agreements might be hindering new construction, especially as developers grapple with rising finance and material costs. There are also reports that cash-strapped housing associations are finding it difficult to acquire homes built under these arrangements. While a spokesperson for the Ministry of Housing, Communities and Local Government stated that no final decisions have been made, they reiterated a commitment to simplifying and enhancing the transparency of the Section 106 process to accelerate home building.