The underlying prospects for the social housing sector are improving after a number of funding and framework agreements were made over the summer, according to industry analysts Glenigan.
Homes England chose 66 companies as preferred partners for its new Delivery Partner dynamic purchasing system in the agency’s largest procurement exercise to date.
The deal will produce £20 billion-worth of spending on affordable housing delivered by developers and contractors (Project ID: 21235829).
Stephen Kinsella, Chief Land and Development Officer at Homes England, said: “This marks a significant step forward in the way we work with developers to build homes.”
In August, a £560 million framework was also agreed by JV North – a group of 13 housing associations and local authorities from Northern England - to build 4,000 homes over the next four years in the region with 17 contractors appointed (Project ID: 21159352).
Glenigan expects social housing construction starts to rise 10% next year. Economic director Allan Wilen says: “Housing associations are now better placed to finance and take forward new developments than in recent years. Government requirements limiting association’s rent increases to 1% below the rate of inflation have been lifted, providing associations with greater flexibility to increase their borrowing to fund new developments.”
London has been a bright spot in terms of social housing construction starts. Glenigan’s construction market research shows the underlying value of social housing construction projects starting on site in the Capital rising by 4% in Q3 2021.
Over the next five years, 29,456 homes will be delivered by councils and housing associations after the Mayor of London secured £3.46 billion from the first round of bidding for the next five-year affordable homes programme.
Clarion received the biggest grant, totalling £240 million. London boroughs will also deliver housing such as Barking & Dagenham, which will receive a grant of £171 million.
The Top 10 housing associations have awarded £1.1 billion-worth of construction contracts in the 12 months to Q3 2021 to build social housing according to Glenigan’s research.
The Guinness Partnership awarded the largest amount with major developments moving onto site including the £55 million King Georges Gate in Kingston-On-Thames to deliver 211 new homes (Project ID: 20257971).
The next biggest spender is Notting Hill Genesis, which has pushed forward with major schemes including a £98 million development in Aylesbury (Project ID: 21345531). Peabody is third with work including a £98 million social housing scheme for 134 social housing units in Herne Hill due to start in November (Project ID: 14338752).
