Social Housing Speed Read – Global Accounts Demonstrate Record Investments in Social Housing
18th January, 2024
The Regulator of Social Housing published its Global accounts in December, which provides a financial overview of private registered providers for the year from 1 April 2022 up to 31 March 2023
Here are some of the key areas that social housing providers have been making investments in.
The report is based on the financial statements of 202 social housing landlords who, together, represent over 95% of the sectors stock. It has shown that significant investments have been, and continue to be made in damp and mould, building safety and energy efficiency.
According to the Global Accounts, housing associations spent a record £7.7 billion on repairs and maintenance during the most recent fiscal year. Compare to 2022 where £6.5% billion was spent on existing properties, this is a 20% increase.
Additionally, investments in new homes have increased by 11% to a total of £13.7 billion, helping to tackle the social housing deficit. As a result, 53,000 additional social dwellings were constructed, a 7% increase from the numbers from 2022.
The social housing sector has faced financial hardships over the years with higher inflation and rising borrowing costs, and this is a trend that has persisted into the current financial year.
As a result of these financial challenges and higher investment spends, providers’ interest cover has continued to decline in the current financial year. Aggregate interest cover stood at the lowest it has been since 2010, at 103% (excluding all sales). In 2018, this was at it’s highest at 170%.
Summary
The Global Accounts demonstrate that the social housing sector has continued to invest significantly in their existing homes by addressing issues with damp and mould, building safety and improving energy efficiency. This indicates that private investment in the industry has not stopped, despite the external economic pressures at play.
New facilities of £9.9 billion in the year have been agreed which has increased the total available undrawn facilities to £30.3 billion. Accordingly, social housing providers remain dedicated to future investments, with increased record spending projected for the next financial year.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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