A new report launched today (15 April) by the G15 group of London’s largest housing associations has found that early engagement and genuine collaboration are essential for successful Section 106 (S106) agreements.

The report, named ‘Building Together, Building Better: Rethinking S106 for Affordable Housing Delivery’ (PDF), is authored by L&Q, one of the UK’s largest housing associations. It outlines what social landlords need when acquiring homes from housebuilders, providing a practical framework for developers to work together with the affordable housing sector.

The themes of early collaboration and continued engagement run through this document and have consistently been priorities for housing associations entering into development partnerships.

The report finds that affordable housing providers should be involved in decisions about new projects from early stages, ideally at pre-planning or land acquisition. This enables the design of places which genuinely meet the long-term needs of all residents.

At the same time, ongoing collaboration and transparency are essential. Developers and their affordable housing partners should work together throughout projects, including regular meetings, shared decision-making about specifications and components and site visits to monitor the delivery of homes.

While in the past, nearly half of all new affordable homes in the country have been delivered through S106 contracts between developers and housing associations, social landlords’ appetite for these agreements has been decreasing lately. In December 2024, the Home Builders Federation reported that more than 17,000 affordable homes in England and Wales were not being built because housing associations were not bidding for them.

Financial constraints, along with economic and regulatory challenges, are partly to blame. However, in 2024, Homes England launched the S106 Affordable Housing Clearing Service, revealing that social landlords often declined homes due to concerns around tenure mix, location and delivery timings. The G15 report adds vital new context about this trend, pointing to a way of developing better partnerships.

Fiona Fletcher-Smith, Chair of G15 and Chief Executive of L&Q, said:

“As housing associations, our primary mission is to deliver high quality, affordable homes for those who are most in need. S106 agreements are a vital way of providing these, but they often provide limited opportunities for social landlords to influence the design of these places or how they will be managed in the long-term.

“With over a million people on housing waiting lists, we urgently need more homes. This report sets out how private housebuilders and the affordable housing sector can work together to create places which truly enable people to live better lives.”

Tom Copley, the Deputy Mayor of London for Housing and Residential Development, said:

“Delivering more high-quality, genuinely affordable housing across the capital is central to our mission to boost local economies and give Londoners the good, secure homes they deserve.

"It is vital that developers and housing associations work together to make the Section 106 process work, and this report provides an important opportunity for further collaboration. The Mayor and I will continue to work closely with our partners across the sector to boost affordable housing delivery and create a better, fairer London for everyone.”

G15 members contributed data that informed this report, which is also supported by the Chartered Institute of Housing (CIH), the National Housing Federation (NHF), and Homes England.

Sarah Finnegan, Head of Policy at the National Housing Federation, said:

“This new guidance from L&Q and the G15 provides an important framework to help housing associations and developers work together to ensure Section 106 delivers the homes we need. By collaborating at pre-planning stage, any concerns about the quality and design of these properties can be addressed from the outset and together developers and social landlords can get on with the vital task of delivering more social homes.”

Rachael Williamson, Interim director of policy, communications and external affairs at the Chartered Institute of Housing, said:

“S106 agreements are a crucial part of building the homes we need, contributing to nearly half of all new affordable homes in recent years. The Chartered Institute of Housing welcomes this guidance from the G15 and L&Q, which aims to improve understanding and clarity from the housing association perspective in the S106 process. It is clear that one of the key ways to ensure that S106 agreements work effectively is early partnership and relationship building between developers, local authorities and housing associations.

“This guidance reinforces the need for collaboration and provides a practical framework to align development decision-making, on timing, tenure, quality, and designs of new homes, with meeting tenants’ needs. This guide contributes to the wider work taking place in the sector to improve the S106 process, and we look forward to seeing its implementation.“

A spokesperson for Homes England added:

“Section 106 plays a crucial role in delivering much needed social and affordable housing – and will be important in helping the Government deliver 1.5m new homes over this parliament. For it to continue to be an effective delivery route and meet local housing needs, it’s clear that there needs to be close collaboration, early engagement and strong partnerships between housing associations, local authorities and housebuilders. This guidance provides a practical framework to help align expectations and values across the sector, as part of wider efforts to improve the S106 market.”