This week I had the pleasure of attending LD Events’ Affordable Housing Conference and meeting some new and familiar faces from the sector. While the lecture hall-esque auditorium took me back to my university days, the discussions were equally as insightful and thought-provoking.

Throughout the day, we heard from leaders within the sector, ranging from developers, pension funds, local authorities, housing associations, housebuilders, and Industry and public bodies. There was a host of topics about affordable housing delivery, macroeconomics and geopolitics, and what lies ahead.

Certainly, the sessions laid bare some of the challenges facing the sector, particularly around funding, housing delivery, and the reality of achieving the 1.5m target (spoiler alert, it’s extremely unlikely!).

Elsewhere from a national perspective, we were told the UK has the highest rate of homelessness in the developed world and that we build fewer homes than the majority of developed nations.

Perhaps the one thing that struck me the most, even on my commute home, was the shocking statistic from Homes England that each day 159,000 children in the UK wake up in temporary accommodation. In a way this sums it up, many are being failed and the implications for thousands across society will be felt in years to come.

Here are some key takeaways I took from the day’s sessions:

Macroeconomic headwinds

There are still significant macroeconomic headwinds facing the sector which is still reeling from the infamous ‘mini-budget’. That aside, the sector is still facing pressures arising from inflation, national insurance increases and the cost of living combined with financial pressures on fire safety remediation and retrofit. This Economic uncertainty has also impacted investor attitudes, while the increased cost of debt and inflation all erode the economic viability of new developments.

Political shifts

With developments across the pond and the significant policy shifts from the current US government, no doubt impacts are being felt in markets across the world, which no doubt will have implications for the housing sector with material costs set to rise amidst the imposition of tariffs and global trade wars. Similarly, with the UK government increasing its defence budget and welfare cuts on the horizon, this could potentially allocate funds destined towards housing to be spent elsewhere, leaving a further funding gap.

S106

One topic that popped up throughout the day was section 106 with many builders facing challenges and barriers with costs and often clashing with local authorities, which is impacting the provision of affordable housing available. There were several calls here for s106 reform to remove some of these barriers. The government has last month indicated it is committed to introducing a faster and clearer process, following a public consultation – so watch this space.

Skills gap

Another prominent feature of discussion was the skills gap and the acute lack of skilled workers to deliver new homes. To meet new targets, we need 162,000 more people working in construction and encourage more young people to look at construction careers.

Uncertainty

There is an air of uncertainty, be it with specifics on government policies with a destination mapped out but the journey is still yet to materialise. Many are awaiting more details and policies to be fleshed out by the government but also to see if additional funding, planning changes, and rent settlements will be announced– all eyes on March’s Spring Statement and the July Spending Review.

Partnerships and JVs

Local authorities, house builders, and housing associations are looking to JVs to help plug funding gaps and deliver new homes, place, infrastructure, and regeneration. There have been successful examples of these across the country and more such partnerships could be one way to overcome some of the challenges faced.

What’s clear is that there is no single solution or silver bullet to fix the multitude of problems the sector as a whole is facing. More needs to be done, the sector needs greater clarity but also there needs to be greater collaboration and communication not only within the sector but private finance and with government and residents to help unlock the building of new homes.

A thought again to the 159,000 children waking up in temporary accommodation. If things don’t change, this stocking statistic will only worsen.

By Tushar Parmar, Account Director