The Social and Affordable Homes Programme: key points

On 7 November 2025, the Government published their guidance for the Social and Affordable Homes Programme (SAHP), ahead of its anticipated launch in February 2026.

As you may be aware the SAHP will run from 2026 until 2036 and make £39bn available to registered housing providers, local authorities, house builders, developers, and other charity and community groups to support housebuilding. The Government’s guidance relates to the £27.3bn of funding which has been made available to deliver new social and affordable homes outside of London and aims to help potential applications access information and support ahead of bidding opening in February 2026 and the first grants being made in April 2026.

We have reviewed the prospectus and summarised the key points to note for potential bidders:

What the Funding can and cannot be used for:

Whilst it remains true that the SAHP will aim to ensure three in every five new homes delivered are for social rent and should contribute to national priorities (the 1.5 million homes target), the prospectus confirms that funding can also be used to boost council housebuilding, specialist and supported accommodation, community-led and rural housing, regenerate existing housing estates or to acquire market homes to use as affordable housing.

For rented homes, registered providers are expected to work closely with councils to help fulfil their duties to meet local housing needs and landlords will be expected to provide 100% of first lets through nominations agreements.

Whilst Homes England expect that most schemes will be delivered on land acquired for building, Homes England has said it will also consider bids that propose converting homes built for market sale to social and affordable housing, provided that it can be demonstrated that this will speed up the delivery of affordable homes within this parliamentary term.

However, the prospectus confirms that SAHP cannot be used for acquiring Section 106 homes nor can it be used for specialised supported housing or temporary social housing.

Who and in what ways can bids be made for the funding:

Ahead of bidding opening in February 2026, Homes England has advised that they will be publishing full guidance on the bidding process,  however for the time being the prospectus confirms some useful information and guidance for potential bidders.

Homes England will accept bids from both not-for-profit and for-profit registered providers, as well as local authorities, house builders, charities and community-led organisations and bids can be made by either individual organisations or as part of a wider consortium or strategic partnership.

The latest guidance also outlined the two bidding routes available to providers - continuous market engagement (CME) or strategic partnership.

CME has been touted as an “effective” option for small to medium-sized partners or local authorities with development ambitions but who are unable to spend and deliver at scale.  CME will allow them to access funding on a “scheme-by-scheme” basis.

There is also a new ‘portfolio’ option under the CME route, which aims to support partners demonstrating delivery ambition for schemes that may be at different stages of delivery and under this option funding will be paid out on achievement of applicable milestones.

Under the strategic partnership route, funding is offered on a long-term basis for partners with “ambition, capability and track record of delivering large numbers of new social and affordable homes”. Providers bidding under the strategic partnership route may get the opportunity to apply for additional funding throughout the 10-year programme, depending on budget availability and their delivery performance.

The prospectus sets out four options for becoming a strategic partner, which includes the existing model of registered providers delivering at scale, local authorities delivering in a single region, specialist and supported housing delivery, and developer-led delivery all of which have various requirements, covering the minimum number of homes and an initial funding cap.

Homes England requires all schemes under both routes to start on site by 31 March 2036 and complete by 31 March 2039. It has advised that it will prioritise early delivery.

How bids for funding will be assessed:

All bids will be assessed on their value for money, strategic fit and deliverability, and partners are expected to minimise the level of grant funding requested and maximise their own contribution.

Under the CME route, the value for money metric will be grant per home, whereas strategic partnership bids will be assessed using the benefit-cost ratio set out by the government. Strategic partnership bids will also be assessed on “a pass or fail basis”, which will entail Homes England looking at a provider’s previous track record, local relationships, and evidence of pipeline and planning status.

How Combined Authorities will control funding:

The government has announced that metro mayors in the six combined authority areas of Greater Manchester, West Midlands, West and South Yorkshire, the North East, and Liverpool have been allocated £7bn from the SAHP and will be able to “set the strategic direction” of the SAHP, which includes shaping the tenure mix and identifying priority sites.

Homes England has said that whilst it will share information from bids they have received with the relevant established mayoral strategic authorities, it will remain responsible for the final funding and contractual decisions.

Design, Quality and Sustainability

The prospectus emphasises that all homes delivered using SAHP grant funding must meet the relevant legislative, regulatory and planning policy requirements, but partners are encouraged to deliver homes above minimum requirements and to share ideas around how SAHP funding can achieve quality and sustainability ambitions.

The prospectus stressed the importance of embedding equality, diversity and inclusion principles “across every stage” of development. Homes England said it expects all partners applying for SAHP funding to “demonstrate their commitment to inclusive practice in the design and delivery of their projects”.

Beyond compliance with equality legislation and robust policies around discrimination, Homes England said providers should focus on “treating communities, contractors and suppliers with dignity and respect”. It also said procurement and delivery processes should be “fair, transparent and inclusive”.

Flexibility

The Government has sought to recognise that some “much-needed” types of social and affordable homes often cost more to deliver, such as supported housing or council homes.

For this reason, and based on feedback from providers, the SAHP will have “flexibility on grant rates” to enable delivery of these more expensive homes. This means Homes England will not publish standard grant rates, noting the exception of the time-limited fast-track planning route in London as part of the emergency housebuilding package.

Furthermore, Homes England has advised they will not publish national, regional or scheme type benchmarks, saying it is keen to support a “wide range of delivery from a diverse range of partners”. Organisations applying to become a strategic partner will be able to bid for two grant rates per tenure, per region to support distribution across lower and higher cost schemes, according to the prospectus. Partners will also be able to combine grant funding with Right to Buy receipts when submitting bids for SAHP funding.

Jacob McGrath is a Paralegal in the Housing & Regeneration Team at Forbes Solicitors.