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Grant rejections for Affordable Homes Programme cut by 96% in five years
The number of grant applications that were refused under the Shared Ownership and Affordable
Homes Programme have were down by 96% last year when compared with five years ago.
Data requested by Inside Housing under the Freedom of Information (FOI) Act showed that 10,589 applications to the programme were rejected across the past five financial years.
But the total yearly figures fell from 2,293 in 2016-17 to just 95 in 2021-22.
Homes England said this was down to it engaging better with local authorities and having greater understanding of their delivery pipelines and goals. This has meant it has been able to ensure proposals from housing associations are better aligned with local plans.
The Affordable Homes Programme (AHP) is the primary channel for funds to be distributed to housing associations and local authorities to build new homes.
Since it was first launched in the early 2010s, it has dished out billions of pounds to providers to build hundreds of thousands of affordable homes. The last five-year settlement, covering the period between 2016 and 2021, was the biggest yet, with the government committing £9bn across the country.
This was increased to £11.5bn when the new five-year funding scheme started in 2021.
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The information in the FOI release was also broken down by tenures, including affordable homes, affordable rent, rent to buy and social rent.
In the first two years of the data, there were no rejected applications for social rent, but this rose to 273 in 2019-20 and then fell back down to two in 2021-22.
Affordable rent proposals have seen the most rejection, with 5,483 applications refused in the past five years.
This is followed by affordable homes, with 4,027 rejections.
Homes England explained there are a number of reasons why a provider’s bid may be rejected. These include an unusually high grant ask per home, the proposal failing to identify a specific local need, or some bids simply not meeting the requirements for the funding.
A spokesperson for Homes England said: “As the government’s national housing and regeneration agency, a core part of our remit is to boost the supply of affordable homes in the places they are most needed through the AHP 2021-26.
“We work in partnership with local authorities and housing providers to do this in the most effective way.
“Homes England regularly engages with local authorities on their delivery pipelines, and we encourage early engagement from bidders wishing to apply for affordable housing grant with both the agency and the relevant local authority.
“This helps partners to be able to align their bid to the local authority’s housing growth ambitions and housing needs, and ensure that their proposal is in line with that authority’s local plan.”
The agency said this approach has helped ensure a higher proportion of bids are successful, and that the AHP is delivering against its ambitions.
However, the Department for Levelling Up, Housing and Communities warned this month that a rise in inflation and interest rates could make schemes under its AHP no longer viable. This is because the sudden and unforeseen increases are not reflected in initial bids and grant rates, according to a new report.
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