Councils and for-profits invited to become Homes England strategic partners as new programme details revealed

The strategic partnership programme was launched back in 2018 under chancellor at the time Philip Hammond, and was a move away from the scheme-by-scheme funding for affordable homes was previously administered. Instead, the strategic partnerships are a multi-year grant scheme where individual organisations or partnerships secure funding upfront in exchange for committing to deliver hundreds of homes by a certain date.

In the first wave of strategic partnerships more than £1.7bn was handed out to a total of 23 strategic partners, which collectively committed to start a total of 40,000 affordable homes by March 2022.

However, where the last programme was focused solely on housing associations, this time around will see a broader range of organisations being asked to become partners when the application process opens next month.

Under the new form of the scheme there will be four different streams. The first will be similar to the one launched in 2018, where single associations or partnerships will be able to bid for a grant package up to £250m, to deliver at least 1,500 homes in the next five years.

The second stream, the long-term strategic partnership stream, will be for the 23 partners that already signed up for the programme in the first wave.

To become a long-term partner, organisations or partnerships must commit to 4,000 homes in the five-year period, with all homes starting by 31 March 2027 and completing by 31 March 2029. Partners must also agree to draw down all grant by 31 March 2026.

Homes England will also be introducing a stream for local authorities for the first time, with councils or council partnerships now able to bid for a grant ask of up to £150m. Councils will again have to commit to 1,500 homes, with all needing to start by 31 March 2026.

The final stream will be for for-profit providers. This will be open to for-profit registered providers but also private developers that will be building homes for affordable tenures to be managed by associations once complete.

Again, these applicants will have to build at least 1,500 homes but will Homes England will accept bids from single entities only.

If applicants are not registered providers with the Regulator of Social Housing but are building homes for rent, they must make clear who will be managing these homes once completed. Grant payments will be paid out on a quarterly basis to partners.

Successful partners will have to commit to starting their homes by 31 March 2026, and complete them all by March 2028. A quarter of all homes will need to be built using modern methods of construction, while all shared ownership homes will be built under the ‘right to shared ownership’.

All applicants will state exactly how many social rent homes they will be looking to build during the application process.

Similarly to last time around, strategic partnerships will be able to add delivery partners to their team and can dish out part of their grant to smaller associations to help them deliver on their commitments.

To bid, organisations must be Homes England investment partners and those associations bidding for grant for the first time must have at least a G1/V2 rating with the regulator.

Homes England will also continue with its continuous market engagement funding programme, which allows associations to bid for grant funding for building on a development-by-development basis.