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AHF gets cheaper borrowing costs than government on latest deal
Another housing association has taken some of the last funds from the government-backed loan scheme, Affordable Housing Finance (AHF).
Kent-based Golding Homes borrowed £51.5m from AHF’s European Investment Bank (EIB) facility, achieving a cheaper cost of borrowing than the UK government. The overall cost was a fixed rate of 1.791%, which was 0.04% below the cost of government borrowing.
This was the 29th time AHF had drawn down funds from its EIB facility at an overall cost of lower than 2%.
The 20,000-home association will be able to access the funding from 19 December, boosting its development plans.
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Neil Perrins, director of resources at Golding Homes, said: “I am delighted to build our relationship with The Housing Finance Corporation, AHF and the EIB with this new low-cost financing. It will support Golding Homes’ growth plans and help us deliver 600 new homes across Kent over the next three years.”
Piers Williamson, chief executive at AHF, added: “Although there is some debate about what will be announced in [today’s] Budget, all will agree today’s deal, alongside the previous loans agreed under EIB, represents the most efficient mode of competitive financing, delivering new homes across a variety of tenures.”
The last month has seen a flurry of activity from AHF as it nears the end of its funds. The chancellor has discussed the possibility of using his Budget to underwrite loans, but this measure has largely been trailed as being aimed at small and medium-sized developers, rather than housing associations.
