Thousands of new homes are at risk following cuts to social rent, warned planning specialists at property consultancy Daniel Watney, after Genesis housing association announced that it would cut the number of affordable homes it builds each year and double the amount it sells.

The 10-year pay deal for registered social landlords agreed in 2013 was torn up in the emergency summer Budget. Rather than increasing by 1% on top of inflation, social rents will fall by 1% each year for four years, in a bid to cut the benefits bill by £1.5bn.

However, aside from the obvious direct hit to registered social landlords' (RSLs) balance sheets, thousands of new homes built by private developers are at risk because of the way finance structures are set up to include payments received for the affordable housing elements.

This will affect private development - not just RSLs - due to the planning agreements in place across thousands of schemes. It could prove a calamitous unintended consequence, warns Charles Mills, head of planning at Daniel Watney. Mills adds: "Almost all housing schemes will include an element of affordable housing and the cuts in rents have forced every RSL to rethink their entire business strategy in the hope of achieving what the government calls 'efficiency savings'.