The Department for Levelling Up, Housing and Communities (DLUHC) has admitted development by housing associations may fall as they seek to ensure viability and divert funding to improve existing homes.

The government department, in its submission to a Commons select committee, said registered providers are facing a “more challenging position” than in recent years.

It said: “It is vital that registered providers (RPs) manage their resources effectively to ensure that their financial viability is maintained and that they deliver on their responsibilities to their residents.