Network Rail to set up property company to deliver 40,000 homes

26 March 2025, 21:57 | Updated: 27 March 2025, 13:10

Network Rail will set up a new property company to build 40,000 homes on its rail estate over the next decade in a drive to meet the government's housing target.

The Treasury on Thursday announced the launch of a new cross-government taskforce to release surplus public land for housing, with unused Ministry of Defence (MOD) sites also to be among the first to be released.

Announcing the plan, Chancellor Rachel Reeves said it would "unlock the next generation of homeowners", as the government strives to deliver 1.5 million new homes by the end of this parliament.

It comes after the UK's fiscal watchdog estimated efforts to unblock the planning system will result in the highest levels of house building in 40 years, adding around £6.2bn to the UK's economy by 2029.

The figures were a rabbit out of the hat in the Office for Budget Responsibility's (OBR) economic forecast, which downgraded growth for this year as predicted, forcing Ms Reeves to announce a raft of spending cuts in order to stick to her fiscal rules.

Speaking a day after Wednesday's spring statement, the chancellor described surplus government land as "a huge untapped resource that could create opportunities for the next generation of homeowners".

She added: "In contrast to the failed approach of the past, we are making the best use of public land to build the homes that families and our Armed Forces need, improving opportunities for homeownership and creating jobs across the country.

"The OBR (Office for Budget Responsibility) has confirmed our planning reforms will result in housebuilding being at its highest in over 40 years - that won't just bring jobs and economic growth - but also will give families the homes that they deserve, delivering on our plan for change."

Surplus MOD sites will pioneer the scheme, with the department to work in partnership with Homes England so land at Chetwynd Barracks in Nottinghamshire and Wyton Airfield in Cambridgeshire can be utilised for over 1,300 new properties.

Deverell Barracks, near Ripon, North Yorkshire, will also be released to expedite the delivery of another 1,300 homes - with work to start within 12 months.

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Defence Secretary John Healey has identified opportunities to build more than 100,000 homes on surplus military land in future, the Treasury added.

Part of this will include a commitment to building new military family homes, following the return of Armed Forces housing to public ownership earlier this year.

Network Rail plans to create its own development company, which will become operational later this year.

This will include as many as 5,000 homes at Newcastle Forth Yards; 1,500 homes at Manchester Mayfield station, and a mixed-use development in Nottingham which could yield 425 homes.

It is not clear how many could be affordable housing.

On Tuesday, the government announced £2bn for 18,000 new homes, saying it expects half of them to be affordable.

But charities called for the "vast majority" to be for social rent as homelessness hits record highs across the country.

The funding was described by the government as a "down payment from the Treasury" ahead of longer-term investment in social and affordable housing expected to be announced later in the year.