As we look ahead to the next 12 months, Aster Group’s chief investment officer Amanda Williams highlights how housing associations could, and should, establish a key role in Labour’s housing regime.
Last year saw the Labour government place housing front and centre of its policy platform through a raft of announcements that culminated in the publication of the long-awaited National Planning Policy Framework.
This, combined with a £500million top-up to the Affordable Homes Programme, plans for a new five-year rent social housing settlement and a promised boost to capacity in planning departments, have meant that the housing sector entered 2025 with greater clarity on what the future holds.
However, that’s not to say that the road ahead is clear. As we wait to see what this year has in store, there are a number of obstacles and opportunities for housing stakeholders to be aware of.
Looking ahead
Despite the early optimism instilled by Labour’s policy agenda, there are ongoing challenges in planning, supply chain pressures and political uncertainty. The impact of high input costs on housing delivery is also set to be further exacerbated by upcoming changes to National Insurance employer contributions and the National Living Wage.
These headwinds will have a particularly acute impact on housing associations. We will have to balance accelerating the delivery of new homes to support meeting the government’s housing targets that are also the most affordable homes in a generation, along with the need to invest in existing stock and ensure that all homes are sustainable and at least EPC C by the 2030 deadline.
High inflation has caused a real-term decrease in social housing revenue across the sector. The National Housing Federation now predicts that this reduction in investment capacity will mean the sector delivers 27% fewer homes over the next decade than if it were able to continue building at the rate it did in 2023. While no one wants this to be the case, it does illustrate the challenging environment that we as housing associations are currently operating in.
Despite these hurdles, the expertise, knowledge and social purpose that the sector can offer will be essential to fulfilling the government’s housing delivery targets.
Facilitating partnerships
But housing associations can do more than drive housing delivery. We can work as facilitators and convenors – a central point to creating housing industry partnerships.
Our extensive network of relationships and history of collaboration with the private sector will be invaluable in ensuring that the government, delivery partners and communities are all aligned in terms of goals.
The government has recognised that to meet its ambitious delivery targets, it needs to take a multi-faceted approach and leverage connections between the public and private sectors.
The National Wealth Fund and its £750million financial guarantees to Lloyds Banking Group and Barclays to underpin investment in retrofitting social homes is already evidence that the government is willing to harness business expertise within the housing sector, but there is more to be done.
That’s where housing associations come in. We can help join the dots between stakeholders in the public and private sectors and advocate collaboration to help deliver against the government’s housing targets.
Bridging the gap
Forging strong partnerships with local communities will also be a powerful driving force for home delivery.
In a recent survey, we found that 54% of respondents believe that housing associations play a vital role in communities. That’s because we’re well placed to act as the intermediary between the government, supporting agencies and communities – ensuring that the right homes are built for everyone.
We also found that 69% of people think that communities should have a greater say over the housing built in their area. There is already a mechanism in place to give communities more ownership over what housing is built in their area in the form of community land trusts (CLTs).
CLTs place communities at the heart of housing developments and remain an underutilised tool for housing delivery. At Aster, we are actively involved in various CLT projects and are one of the most active CLT housing association partners in the UK.
2025 is set to be an exciting year for CLTs and we’ve just finalised our largest partnership to date with Transition Homes CLT, delivering 39 new energy-efficient, affordable homes for social rent. Through our involvement in this space, we’ve developed a sound understanding of how housing delivery goes beyond just the numbers and can really nurture local communities.
This year will be another challenging one for the housing sector. However, we have more tools in our arsenal than ever before to drive housing delivery and ensure our existing stock is built to last.
We, as housing associations, hold the skills, experience and connections to drive housing delivery and critically address the need for more affordable housing. It is now up to us to communicate this and carve out our role in Labour’s plan to get Britain building.
