The latest Quarterly Survey, published today (12th September) by the Regulator of Social Housing, shows a strong financial position has been maintained by the sector, despite wider economic “uncertainties”.
According to reports, the regulated sector has access to £20.4bn in undrawn facilities and agreed new finance of £1.4bn in the quarter.
Investment in new housing supply stood at £3.1bn in the quarter to June 2019, with 3,275 Affordable Home Ownership (AHO) homes and 1,193 market-sale homes completed.
This is expected to increase with a £16.1bn investment forecast over the 12 months to June 2020.
Based on responses from 218 private registered providers (PRPs), including PRP groups, which own or manage 1,000 homes or more, the report is said to provide a regular source of information regarding the financial health of providers and their liquidity position.
The other main findings for the quarter include:
- Cash balances total £5.3bn – this is forecast to reduce to £3.4bn over the next 12 months to fund planned capital expenditure
- Total sales receipts were £1.1bn generating surpluses of £0.3bn – however, current asset sales receipts were more than 40% below forecast at £0.7bn reflecting both fewer completions than forecast and market conditions, particularly in London and the South East
- There was a 2% increase in the number of unsold AHO homes to 7,031 (the highest level in 10 years), and unsold market sale properties increased by 7% to 2,073 (the highest level recorded since 2014)
- The number of AHO homes unsold for more than six months saw an increase of 56% to 2,133;
- Conversely, market-sale properties unsold for more than six months reduced by 13% to 554
- The sector’s spending on capitalised major repairs in the quarter at around £400m was 20% below forecast – said to be attributable to delays in starting new contracts for works and to the re-profiling of programmed works
Fiona MacGregor, CEO of the Regulator of Social Housing, said: “The latest Quarterly survey results indicate that the sector continues to be in a strong position in terms of liquidity, but weakening in the housing-sales market is beginning to have an impact, particularly in London and the South East.
“Providers should consider market conditions carefully when making decisions about development commitments.
“The findings underline the need for boards to manage their resources and have robust contingency plans in place to ensure that their financial viability is maintained under a range of economic assumptions.
“We also expect boards to ensure they have clear information that they are investing, so that properties are in a good state of repair and meet statutory health and safety requirements.”