The UK Government has announced the creation of a new National Housing Bank, aimed at unlocking billions in private sector investment to boost housebuilding efforts across the country. Backed by £16 billion in public financial capacity, the initiative is expected to drive the construction of 500,000 new homes.
First hinted at ahead of the government’s recent Spending Review, the Bank will be publicly owned and formally designated as a Public Financial Institution. It will operate as a subsidiary of Homes England, the national housing and regeneration agency.
The Bank is backed with £16 billion of financial capacity, on top of £6bn of existing finance to be allocated this Parliament, in order to accelerate housebuilding and leverage in £53 billion of additional private investment.
By offering a mix of equity investment, loans, and guarantees, the Bank aims to attract global institutional investment into the UK housing sector. It will focus particularly on unlocking complex and large-scale development sites that typically struggle to secure upfront funding due to their risk profiles.
Support for small and medium-sized enterprises (SMEs) will also be a key priority. The Bank plans to form new lending partnerships with private sector firms and provide revolving credit facilities to help SME developers expand and deliver housing projects more quickly.
Additionally, the Bank will oversee the deployment of £2.5 billion in low-interest loans — announced during the Spending Review — to support the construction of social and affordable housing.
It also builds on the £39 billion investment announced at the Spending Review for a new 10-year Affordable Homes Programme.
Officials say the National Housing Bank represents a long-term commitment to reshaping the housing market and tackling structural barriers to development.
Deputy Prime Minister and Housing Secretary, Angela Rayner, commented: “We‘re turning the tide on the housing crisis we inherited – whether that’s fixing our broken planning system, investing £39 billion to deliver more social and affordable homes, or now creating a National Housing Bank to lever in vital investment.
“This government is delivering reform and investing in Britain’s renewal through our Plan for Change. Our foot is firmly on the accelerator when it comes to making sure a generation is no longer locked out of homeownership – or ensuring children don’t have to grow up in unsuitable temporary accommodation, and instead have the safe and secure home they deserve.”
