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Councils are taking advantage of a stagnant housing sales market to increase the stock of social and affordable housing and ease temporary accommodation (TA) costs.In tandem with the Government's drive to increase housing through its £39bn Social and Affordable Homes Programme (SAHP) – the first wave of which was announced last week – councils are bulk buying extra housing units from developers at heavily discounted prices.In London, where affordable housing pressures are most acute, councils are achieving discounts of as much as 40% on private market asking prices as developers struggle to sell in the current economic climate.A sector insider told The MJ the agreements currently tended to be in relation to a few hundred homes at a time.Ealing LBC has announced a new deal to buy 95 new flats at Bollo Yard in Acton to help ‘more local families into safe, genuinely affordable homes'.The homes were previously intended for sale as shared ownership or at 80% of the market rent but will now become socially rented for local people on the council's housing waiting list.It is the third deal the council has done with a developer in the last 14 months, having already bought almost 200 homes in Southall and a further 110 in Acton. Cllr Louise Brett, the council's deputy leader and cabinet housing lead, told The MJ Ealing had achieved ‘a very significant percentage reduction in market value' on the deals.‘We are in a position to negotiate quite hard,' she said. ‘At the moment we are seeing an opportunity in the market and taking advantage of that.‘By buying homes and letting them to local people at genuinely affordable rents, we are taking decisive action to tackle the borough's ongoing housing crisis.'Asked if Ealing had achieved a reduction of as much as 40% in some deals Brett said: ‘Yes, for definite.'Many of the deals being struck are with developers that councils and housing associations are already in development partnerships with and the authority or association has moved to take a greater share of the homes coming online.Developer Vistry, which is working in Lambeth with Metropolitan Thames Valley Housing (MTVH) on the Clapham Park scheme, which will provide an additional 2,000 homes on the regeneration site, has agreed for 76% of the initially built 843 units to become affordable despite the initial plan earmarking just 40%. Vistry, which specialises in mixed tenure developments was last week reconfirmed as a strategic partner in the SAHP, securing £350m in the initial £10bn funding round.The company is one of the biggest developers working with councils, operating across 24 different English regions and on 40 schemes in London.Its chief executive officer for partnerships & regeneration, Stephen Teagle, told The MJ it had agreed deals with councils to sell them more homes for social and affordable rents, including Barnet and Barking & Dagenham LBCs in addition to Ealing.The sector insider said the practice of councils buying new homes from registered social landlords (RSL) was also taking place. The RSLs, having worked with firms to build properties using section 106 funding, are increasingly finding their budgets eaten up by maintenance and improvement works on existing homes, leaving councils to step in. Asked if the practice of councils bulk buying extra homes was currently widespread Teagle said: ‘Absolutely, across the whole sector. For us that is an active part of what we do. ‘You can go across London and on our schemes and we are well beyond 50%, we have sold 75-80% to councils, housing associations and institutional investors. We are very happy to do that.'‘Across the sector, beyond Vistry, yes that is taking place. Housing associations and local authorities have been able to acquire homes from house builders that were originally intended for open market sales, but the subdued or stagnant open market at the moment has resulted in them being sold in bulk to housing associations and local authorities.'Yet, there is little evidence of councils collaborating to strike deals with developers despite the potential to demand even greater price reductions. A barrier to this is believed to be the fact that councils are individually focused on buying extra stock in their own areas.Nonetheless, while Brett said wider collaboration was not something Ealing had embarked upon, she was keen for all possibilities to be explored.‘We need to make sure that we are looking at every single option possible to make the outcomes better.‘There's a mixture of different things that would make those kinds of deals more complicated. You've got to make sure that you've got the grant rate from the Greater London Authority and their agreement, and that they feel it's good value for money. But it's not necessarily a barrier.Teagle also said he would welcome the idea of councils coming together to bulk buy properties.Despite the practice of councils bulk buying extra homes proving a win-win for developers and councils Teagle pointed to financial restrictions that were preventing further deals taking place.‘The concept of local authorities having the financial capacity to procure homes [through bulk buying] I totally welcome,' he said. ‘That would be a great route to trying to address some of the long-term problems that we see that our communities have in terms of having the right supply of housing.'‘The issues is, how do local authorities obtain the financial freedoms to do that? They need to access affordable loans. Many are grappling with indebtedness under the HRA [Housing Revenue Account].'Cllr Anthony Okereke, London Councils' Executive Member for Housing & Homelessness, said: ‘We would certainly welcome further support from the Government on this issue.‘Boroughs are calling for additional and more flexible grant, improved access to low-cost loans, and a review of the HRA debt settlement to increase borrowing headroom.‘With greater financial firepower we can act quickly to acquire more homes, helping to reduce housing pressures within our communities and to keep a roof over the heads of homeless Londoners.'

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HOUSING

Councils bulk buying housing from developers to ease pressures

By Paul Marinko | 03 September 2026

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