Half of rural England's affordable homes at risk from planning rule changes

Created at 6 Jul · 6:15 AM1 source↑ Market-relevant

IN SHORT

Analysis suggests that relaxing planning regulations for private housing developers in rural England could jeopardize half of the affordable housing supply. Ministers are considering ending affordable housing quotas for developments of 10-49 houses, potentially costing the country 32,000 homes over a decade.

Key Numbers

50%affordable housing supply at risk in rural England

10-49house development size for proposed rule changes

32,000affordable homes potentially lost over 10 years

36%of affordable homes delivered via section 106 agreements

2024-25financial year for section 106 data

Who's Involved

National Housing Federation

organization that analyzed government figures on affordable housing

Kate Henderson

Chief Executive of the National Housing Federation

Ministry of Housing, Communities and Local Government

government department considering the planning rule changes

Andy Burnham

Makerfield MP and likely next Prime Minister

↳ Why This Matters

The proposed changes could significantly reduce the supply of affordable housing in rural England, worsening a housing crisis for families already struggling to afford homes in their communities and potentially increasing homelessness.

Key facts

Half of affordable housing supply in rural England is at risk from proposed changes to planning regulations.
The government is considering ending affordable housing quotas for new developments of 10 to 49 houses.
Developers may be allowed to make cash payments to local authorities instead of building affordable homes.
Analysis by the National Housing Federation suggests this could result in a loss of 32,000 affordable homes over 10 years.
Section 106 agreements currently account for 36% of all affordable homes delivered.

Half of all affordable housing supply in rural England could be threatened by proposed government plans to relax regulations for private housing developers. The government is considering ending affordable housing quotas, known as section 106 agreements, for new developments ranging from 10 to 49 houses, aiming to boost construction rates. Developers might be allowed to make cash payments to local authorities instead of fulfilling these quotas.

Analysis by the National Housing Federation (NHF) indicates that in the most rural areas, over half of all affordable homes are built on developments of this size. The NHF warns that removing this requirement could lead to a loss of 32,000 affordable homes over the next decade, exacerbating the rural housing crisis and increasing waiting lists and homelessness.

Kate Henderson, CEO of the NHF, stated that rural families are in acute need of affordable homes and that removing the requirement for affordable homes on medium-sized sites would put future rural affordable housing at risk. A spokesperson for the Ministry of Housing, Communities and Local Government said no decisions have been made but that the government is committed to simplifying the process to build more homes.

Section 106 agreements have become a crucial source of affordable housing, accounting for 36% of all affordable homes delivered in 2024-25. However, ministers are concerned these agreements are hindering new building due to high costs for developers. In London, affordable housing requirements have already been reduced for developments seeking fast-track planning status due to a significant drop in new housebuilding.

Frequently asked questions

Section 106 agreements are legal obligations between a developer and a local authority, often requiring the developer to provide affordable housing or contribute to local infrastructure as a condition of planning permission.

Ministers are concerned that section 106 agreements are hindering new housebuilding, especially given current high costs of finance and materials for developers.

The National Housing Federation is an organization that represents housing associations in England, advocating for affordable housing.

What Happens Next

01Ministers are due to make a final decision on the proposed changes within weeks.

02Work is understood to be continuing on technical changes to planning rules.

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Cadence

How It Developed

Government proposed ending affordable housing quotas for new developments of 10-49 houses.

Ministers are considering allowing cash payments to local authorities instead of affordable housing quotas.

Analysis by the National Housing Federation suggests over half of affordable homes in rural areas are built on developments of this size.

The National Housing Federation warns this could cost 32,000 affordable homes over 10 years.

The Ministry of Housing, Communities and Local Government stated no decisions have been made but aims to simplify the process.

Section 106 agreements account for 36% of affordable homes delivered in 2024-25.

Ministers are concerned section 106 agreements hinder new building due to high costs.

In London, affordable housing requirements were reduced for fast-track planning status due to plummeting new housebuilding rates.

Sources

Half of affordable new homes in rural England could be at risk if planning rules relaxed, analysis showsThe Guardian