Housing Boost | What the Government’s £39bn Investment Means for the UK Property Market?

About the Chancellor Rachel Reeves' Spending Review, setting out the budgets for all government departments over the next few years. Chancellor has confirmed the Government’s commitment to inject £39 billion into social and affordable housing over the next decade. This is one of the most substantial investments of its kind in recent history and is positioned as a central pillar of the Government’s plan to "renew Britain."

The funding will nearly double annual investment in affordable housing to £4 billion by 2029–30, up from £2.3 billion in the 2021–2026 period. This investment is expected to support local authorities, housing associations, and private developers in the delivery of new homes across the country. Source: BBC 11.06.2025

The Bigger Picture: A Step Toward Solving the Housing Crisis

Kate Henderson, Chief Executive of the National Housing Federation, called the package “the most ambitious affordable homes programme in decades,” describing it as a catalyst for a generational increase in social home delivery.

Melanie Leech, Chief Executive of the British Property Federation, highlighted that prioritising affordable housing in such a challenging fiscal environment demonstrates the Government’s clear recognition of the sector's importance.

There are, however, some notable omissions. Despite previous reports, the Spending Review made no mention of the anticipated creation of a UK 'housing bank' through Homes England. 

This initiative was expected to offer lower-cost financing to housebuilders by enabling Homes England to operate as a public financial institution. Whether this will be revisited in future announcements remains to be seen.

What This Means for Borrowers and the Property Market

The £39bn investment signals a strong commitment to reinvigorating housebuilding in the UK, which could have positive ripple effects throughout the property and financial services sectors.

As Paresh Raja, CEO of Market Financial Solutions, pointed out:

“For all the talk of planning reform and the use of AI to improve the planning process, significant investment is key. Government spending will encourage private sector activity and breathe new life into the housebuilding industry."

At Penn Financial, we recognise that access to the right finance solutions will be more crucial than ever as this investment begins to shape the market. Whether you are a first-time buyer, a developer, or a seasoned property investor, ensuring that you have the right mortgage and protection products in place is vital.

We are here to help you navigate these opportunities and can offer tailored financial advice that supports your property goals in this evolving landscape.

Contact us: hello@pennfinancial.co.uk

The information provided in this article is not intended to constitute professional advice and you should take full and comprehensive legal, accountancy or financial advice as appropriate on your individual circumstances by a fully qualified Solicitor, Accountant or Financial Advisor/Mortgage Broker before you embark on any course of action.