Homes England recently launched a new Section 106 Affordable Housing Clearing Service   

to  increase registered providers’ (RPs) and local authorities’ (LAs) interest in purchasing section 106 affordable homes in England that developers are struggling to sell. The service will simplify and speed up the sale of uncontracted and unsold affordable homes across England. 

The cost of section 106 properties in 2024 resulted in many registered providers drastically reducing the number of properties they bought. Homes England aim to increase sales of section 106 properties by facilitating this new clearing service. The service willbring together sellers and buyers allowing the market to function more effectively and reduce current difficulties for developers in selling section 106 affordable homes where planning permission has been obtained.  

This service only applies to properties in England, with the exception of homes in Greater London. Properties within Greater London do not fall under this service because the Greater London Authority (GLA) is responsible for affordable housing in this area.   

The clearing service will work by providing a dedicated space for developers to provide details of affordable housing where they have been unable to find a buyer. This information will then be made available for RPs and LAs to view with the service acting as a mechanism for buyers and sellers to connect in one place.  

Whilst use of the service is not compulsory, Matthew Pennycook, the Minister of State for Housing and Planning, reiterated that the Government is encouraging all developers, RPs and LAs, regardless of their size, to engage with the new clearing service. The success of the service will depend on all these stakeholders actively using the service for their sale and purchase of section 106 affordable homes.  

Conclusion 

While there is no detailed information on the scheme at present we are encouraged by the government tackling the issue of section 106 properties which are difficult to sell and hope this will have a positive impact on the delivery of section 106 affordable housing. The Government confirmed the service will continue to be developed in the coming months as feedback is received, and we will continue to monitor progress as the service is tried and tested.   

Further information on the service, including how to register for access the Section 106 Affordable Clearing Service can be found here 

How Capsticks can help 

Capsticks is well positioned to help Registered Providers to understand this new service being the firm of choice for RPs and LAs, offering comprehensive legal services across development, planning law, corporate and securitisation, housing leasehold and asset management.  

Our team has in-depth expertise in all areas of planning law, including Section 106 Agreements, Highways Agreements, Community Infrastructure Levy (CIL) advice, planning appeals and general planning and development matters. 

If you have any queries around what's discussed in this insight, and the impact on your organisation, please speak to Suzanne Smith and Jennifer Eng to find out more about how Capsticks can help.