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10 Things to Know About Affordable Housing
Affordable housing in England is a defined set of tenures for households whose needs are not met by the open market. This explainer draws on government fact sheets, local authority guidance and planning policy to set out ten essential facts about the types, rules and numbers behind affordable homes.
A clear guide to how affordable housing works in England, covering the main tenures, eligibility rules, planning requirements and delivery programmes.
Affordable housing is defined by need, not just price
In England, affordable housing is not simply cheaper property. The National Planning Policy Framework defines it as specific tenures for households whose needs are not adequately served by the commercial market. It includes homes for rent and for sale, and access is based on eligibility criteria such as income, existing ownership and local connection rather than price alone.
Social Rent homes are set at around half of market rents
Social Rent is the most affordable rented tenure. Rents are set through the National Rent Regime at roughly 50 per cent of local market rents. These homes are allocated to people on low incomes via local authority housing registers and are provided by councils and registered housing providers.
Affordable Rent is capped at 80 per cent of local market rent
Affordable Rent properties are let at no more than 80 per cent of the local market rent, including service charges. This tenure sits above Social Rent but below market levels and is also accessed through the housing register. It is offered by councils and registered providers.
Intermediate Rent fills the gap between Social and market rents
Intermediate Rent homes are let at rates set between Social Rent and market rent levels. They provide a middle tier for households who cannot afford market rents but may not qualify for Social Rent. This tenure is part of the government's defined affordable housing for rent categories.
Shared Ownership lets buyers purchase a share and pay rent on the rest
Shared Ownership allows eligible buyers to purchase a share of a home (typically 25 to 75 per cent) and pay a subsidised rent on the remaining share. Buyers can usually increase their share over time through staircasing. It is a main route to affordable home ownership and is offered by housing associations and developers.
First Homes offer 30 to 50 per cent discount for first-time buyers
The First Homes scheme sells new-build homes to first-time buyers at a minimum 30 per cent discount on market value, up to 50 per cent locally. Prices are capped at £250,000 (£420,000 in Greater London) after discount. A restriction on the title ensures the discount passes to future buyers. Homes are advertised by developers.
Discounted Market Sale requires at least 20 per cent below market value
Developers can commit to selling homes at a minimum of 20 per cent below local market value as part of planning obligations. This tenure sits alongside Shared Ownership and First Homes in the affordable home ownership category defined by the National Planning Policy Framework.
Rent to Buy helps tenants save for a deposit while renting
Rent to Buy (sometimes called Rent to Save) lets tenants rent a home at a below-market rate — typically around 80 per cent of market rent — for a set period, giving them time to save for a deposit to purchase the property or another home through Shared Ownership.
Planning policy requires at least 10 per cent affordable homes on major sites
The National Planning Policy Framework expects major residential developments to provide at least 10 per cent affordable homes. Local plans set the exact percentage and tenure mix, which can vary significantly between authorities. In Designated Rural Areas, lower thresholds may apply.
Section 106 agreements are the main tool for securing affordable housing
Affordable housing on private developments is normally secured through Section 106 planning obligations. These legal agreements bind developers to deliver a specified number and tenure mix of affordable homes, either on-site, off-site or via a financial contribution. Viability assessments can affect the final quantum.
Every numbered claim above was required to carry source evidence before this topic could be published.