UK housing targets and council budgets have come under severe pressure despite new investment, the UK Housing Review Autumn Briefing 2025 from the Chartered Institute of Housing (CIH) found.
The report said the Government’s plan to build 1.5 million new homes by the end of this parliament is “stretching and welcome,” but delivery is not keeping up.
John Perry, senior policy adviser at the CIH, said output is expected to fall 25% short of target.
Construction capacity, planning delays and financial constraints were listed as reasons.
Even with the new £39bn Social and Affordable Homes Programme and the National Housing Bank, both private and social sectors are struggling to deliver more homes while meeting higher standards, according to CIH.
Hakeem Osinaike, executive director of housing at Southwark Council, warned council housing finances are “at a crossroads.”
Osinaike said: “Without a sustainable HRA framework, councils will struggle to maintain existing homes, let alone build new ones.”
Rising costs, policy restrictions and low rent increases have pushed many councils into Housing Revenue Account deficits, forcing them to pause or drop repairs and new-build plans.
Osinaike called for a review of the housing revenue account (HRA) debt settlement and lasting reform so councils can invest in safe, sustainable homes.
Mark Stephens, professor at the University of Glasgow, said: “day-to-day budgets remain tight and the overall fiscal position leaves little room for flexibility.”
Stephens described the Government’s Spending Review as “jam today and savings tomorrow” – a short-term boost to investment that will be difficult to keep up without stable long-term funding.
Across the UK, the report found shared challenges and local responses.
In Scotland, a housing emergency led to an Action Plan but work still falls short.
In Wales, housing is a priority but capital constraints limit what can be delivered.
In Northern Ireland, the crisis is worsening despite the return of a devolved Government.
In England, new devolved housing powers and planning reforms bring more local control but raise concerns about delivery capacity.
The briefing also covered planning reform, land value capture, first-time buyer (FTB) prospects, private rented sector regulation, retrofit and net zero delivery, leasehold and commonhold reform, and housing and health inequalities.
