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Rethinking the affordable housing funding machine
A new White Paper examines how the funding of the England's affordable housing sector is changing and what might come next
FINANCE
Matt Cowen
Partner, Winckworth Sherwood
Matt Cowen
Partner, Winckworth Sherwood
Issue 85 | September 2026
The affordable housing sector in England is full of energy. There are new funding commitments in the form of the £39 billion Social and Affordable Homes Programme and the 10-year rent settlement. There are significant changes afoot to the way social homes are managed – derived from Awaab’s Law, Minimum Energy Efficiency Standards (MEES) and the new Decent Homes Standard. And there are fresh ideas, most notably the launch of the National Housing Bank, backed to the tune of £16 billion, with £2.5 billion earmarked for low-interest loans for social housing providers.
Taken together, we are seeing optimism from stakeholders up and down the country that, perhaps for the first time in years, there is a genuine top-down focus on social housing. While many challenges remain for the sector, there is greater acknowledgement of the benefits that a properly funded sector can bring, as well as an honest recognition of some of the failings of recent years and how to fix these.
Rethinking funding
It is in this context that we at Winckworth Sherwood are delighted to have recently issued our White Paper ‘Rethinking the Affordable Housing Funding Machine’. The paper reflects on the evolving funding model and draws on the views from a range of market leaders in the space, including Campbell Tickell. The White Paper provides fresh thinking on what is changing and what comes next.
Our White Paper discusses a range of key themes including:
1. The affordable housing funding model has diversified, with institutional investor-backed capital, in particular, playing an increasingly important role, alongside traditional funding streams. This brings both opportunities and challenges.
2. The transactions market is maturing, with stock rationalisation and a widening range of disposal and partnership structures giving providers new routes to recapitalise their balance sheets, generating headroom for development and retrofit investment.
3. While there is great desire from a range of stakeholders to deliver more social homes, there remain practical obstacles to housing delivery, particularly at local government and planning stages.
“There remain practical obstacles to housing delivery, particularly at local government and planning stages.”
4. A well-regulated sector underpins investor confidence, with the credibility of the Regulator of Social Housing’s regulatory regime seen as a draw for domestic and international capital. The new enabling role of the Greater London Authority and Homes England is welcome and there is recognition that this is leading to deals that might not have previously been feasible.
5. On Environmental, Social and Governance standards, regulatory expectations and investor requirements are increasingly converging. They are becoming a thread that links funding strategy, asset performance, resident outcomes and long-term portfolio decisions. The prospect of retrofitting older housing is evolving into an important long-term asset investment, rather than a short-term compliance cost.
6. Data quality, as well as being a fundamental component of a successfully-run housing provider, has become non-negotiable in attracting new capital. However, for too many landlords, there remains fragmentation across legacy systems which in turn provides a major barrier to modernisation.
7. The clarity of the policy environment shapes the confidence of housing providers, lenders and investors to commit over the long term. Key policy components include the building safety framework, the reformed Right to Buy regime, MEES requirements, Decent Homes Standard and the Renters’ Rights Act 2025. There is also interest in the potential reclassification of social housing as infrastructure, which could materially widen the pool of long-term institutional capital available to the sector.
While the direction of travel on most of these policy areas is clear, it is the detail of implementation and the pace at which it arrives which will determine how quickly confidence translates into delivery.
