The government has announced a £3 billion housing support package aimed at unlocking more homes and driving growth within the UK housing sector. This package includes a range of guarantees designed to help housebuilders access more affordable credit, a key step in overcoming barriers to growth.

The newly announced guarantees will help housebuilders, particularly smaller and medium-sized enterprises (SMEs), to secure low-cost loans from banks and lenders. These guarantees, designed to reduce risk for lenders, aim to stimulate housebuilding by making credit more accessible.

This additional funding will support the construction of over 20,000 new homes across the country, helping to progress the government’s target of delivering 1.5 million new homes by 2029. The increased guarantees are also seen as an important factor in supporting the housing sector’s recovery and boosting the economy by creating jobs and delivering homes in high-demand areas.

One of the key elements of the package is the doubling of the ENABLE Build scheme, which will now provide £2 billion in funding to support smaller housebuilders. This will help to deliver over 10,000 new homes, including those for students and older people, in areas where housing needs are particularly high.

In addition, the Private Rented Sector Guarantee Scheme will reopen later this year, with nearly £2 billion available for Build-to-Rent developers. The scheme is expected to help ramp up housebuilding efforts, offering more accessible funding for a wider range of housing projects, particularly in areas where private rental accommodation is in high demand.

Matthew Pennycook MP, Housing and Planning Minister, expressed that SME housebuilders and Build-to-Rent operators play a crucial role in delivering the government’s ambitious housing targets. He stressed that the additional support through the housing guarantee schemes will provide the necessary confidence for builders to move forward with projects across the country.

The expansion of these schemes follows on from a series of previous initiatives aimed at increasing the pace of housing delivery. These include an overhaul of the planning system, consultations on new mandatory housebuilding targets for councils, and measures to unblock stalled housing developments.

While the announcement has been welcomed by many in the housing industry, including the Federation of Master Builders and the British Business Bank, it also highlights the ongoing challenges faced by smaller housebuilders in securing finance. With access to credit often limited for SMEs, these new guarantees are seen as a necessary step in ensuring they can continue contributing to the housing market.

As the government looks to accelerate the delivery of new homes, it remains to be seen how these additional support measures will impact housebuilding rates across the UK in the months and years ahead. The goal remains to meet the demand for affordable housing and improve the availability of homes for communities across the country.

For rural areas, this package could be particularly important as smaller builders and developers, who often focus on rural and underserved locations, stand to benefit from the increased financial backing. If successful, the schemes could help address housing shortages in these regions and contribute to wider economic growth by supporting local construction projects.

The Rural Services Network will continue to monitor the rollout of these schemes and provide updates to members, particularly those involved in local housing and development projects.