Development viability issues

Housing Community Summit, Liverpool, 9 September 2026

The Housing and Planning Minister Matthew Pennycook MP acknowledged in a speech the tough viability conditions for development, with margins squeezed by reduced interest cover and higher materials costs. He argued the government has nonetheless delivered on its earlier commitments. He cited the £39bn ten-year Social and Affordable Homes Programme SAHP (for at least 60% Social Rent), a ten-year rent settlement at CPI+1% with rent convergence, and £2.5bn of low-interest loans. He also mentioned restored Right to Buy discounts with full receipt retention, ahead of reforms in the Social Housing Bill.

The first SAHP wave allocated just over £9.5bn to 33 Strategic Partners outside London (70,000+ homes), with the GLA offering at least £6bn. Bids far exceeded funding, leaving over £16bn outside London and about £5bn in London still to allocate.

Council housebuilding was the main emphasis. The aim is the biggest programme since the early 1980s, with low-cost borrowing under consideration. He reassured registered providers, urging them to maximise Section 106 delivery using new national engagement guidance and to consider joint ventures with councils. Affordable starts rose 26% last year.

This is the full speech transcript.