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Government seeking ‘new players’ to provide housing associations with private capital
The government is looking to increase the amount of private capital entering the social housing sector, a minister has said.
In response to a written parliamentary question, housing minister Christopher Pincher said the government wants “new players” to fund affordable housing development and urged housing associations to explore new funding streams.
In the question from Mark Pritchard, Conservative MP for The Wrekin, Mr Pincher said: “In recent years, we have seen increasing levels of total investment by housing associations in new supply across a range of tenures (£13.7bn in 2019/20, up 13% on the previous year).
“We are keen to see new players in this market and for housing associations to explore new funding streams to support the supply of new affordable homes.”
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Mr Pincher’s comments come amid the proliferation of private capital within the social housing sector in recent years. This is in part due to a rising number of for-profit housing associations that are often backed by large institutional investors.
Global investment giant BlackRock recently agreed a £360m debt facility with for-profit provider Heylo Housing and M&G Investments struck a deal to provide 2,000 shared ownership homes with Hyde earlier this year.
Hyde, one of the country’s biggest social landlords, also moved to set up its own for-profit provider, becoming the first existing housing association to do so. Chief executive Peter Denton told Inside Housing at the time that the level of capital the sector has is less than what is needed.
The number of for-profit providers is expected to grow in the next year, with the Regulator of Social Housing recently revealing that it has received 50 applications from companies looking to set up a for-profit.
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