The high street lender says its loans will be made available to housing associations, who are existing customers of the bank, at undisclosed discounted interest margins and no arrangement fees. 

Over 1.3 million households are on social housing waiting lists and 145,000 children live without the security of a stable home, according to official figures. 

The National Housing Federation has called for 90,000 social homes to be built each year in England over the next decade to address the country’s housing crisis. 

The bank says its move is part of a £7.5bn “lending ambition” to invest in the social housing sector by the end of next year. 

It adds: “The number of social housing properties across the UK has declined over the years due to restricted financial capacity, stemming from lower public funding for home development, rising costs, limited rent increases, and increased commitments to remediate existing stock to meet building safety and environmental standards.” 

NatWest Group chief executive Paul Thwaite (pictured) adds: “The housing crisis is one of the biggest issues facing our country, which is why we have made a £7.5bn lending ambition to the social housing sector.  

“As part of this, our first of its kind £500m social loan offering is the latest support for our customers to help social rent house building across the UK.” 

Earlier this month, Angela Rayner set out plans to build around 300,000 affordable homes with the £39bn of funding she secured from the June spending review.   

The Deputy Prime Minister and housing secretary adds that at least 60% of homes will be for social rent, linked to local incomes, which would mean delivering around 180,000 homes for social rent. This figure is six times higher than the decade up to 2024.     

The government will set out a new 10-year settlement for social housing rents, to be introduced next April, “to provide the social housing sector with the certainty they need to reinvest in existing and new housing stock”.