ao link
Twitter
Facebook
Linked In
Twitter
Facebook
Linked In

You are viewing 1 of your 1 free articles

From the archive: landlords get to grips with post-crisis cash calls

Inside Housing takes a look at what was happening in the sector 10, 20 and 30 years ago this week....

Linked InTwitterFacebookeCard

30 years ago
Tenants at Rochford District Council in Essex celebrated on the steps of the town hall after overwhelmingly rejecting a proposed transfer of stock to the newly established housing association, Crouch Valley.
Four-fifths of eligible tenants voted against the transfer, with just 6% in favour.
In response to the vote, the council was planning discussions with six other local housing associations and two developers over a new building. Council leaders said that this new building could have been done by Crouch Valley if the transfer had gone ahead.
Opposition Liberal Democrat councillors sought assurance that rents and services would not be affected by the ballot, but Arthur Cooke, chief executive of Rochford, confirmed a 7% rent increase for the coming year with a 20% hike for the following year “because of ring-fencing – which is nothing to do with us”.

 

20 years ago
The government warned local authorities that they were at risk of losing cash for major repairs projects if they were deemed incapable of managing the work properly.
A consultation paper was released outlining the move to ‘resource accounting’, which guaranteed council funding through a new major repairs allowance. The new system gave town halls a ring-fenced pot of money on structural repairs.
The new system altered local authority accounts to reflect the value of homes and the cost of maintaining them, giving councils “greater certainty about future funding”, according to housing minister Hilary Armstrong.
However, there were also government warnings that councils would have to demonstrate that they were targeting spending at the homes most in need or they could face having funds withdrawn. Conversely, those councils assessed as doing well could be in line for extra funding.
The Chartered Institute of Housing welcomed the new approach as “more rational and accountable”.
However, Peter O’Kane, chief executive of the London Housing Unit, criticised the consultation paper for its failure to address the £23bn national repairs backlog.
Elsewhere in the consultation, the government signalled it would end tenants’ subsidy of housing benefit, which campaigners had condemned as “daylight robbery”, according to Inside Housing.

 

10 years ago
“Extraordinary and unprecedented” fluctuations in the markets in the wake of the global financial crisis had left housing associations having to find millions of pounds at short notice to satisfy ‘cash calls’ from investors, Inside Housing reported.
The calls were as a result of associations having to provide extra security against complex financial arrangements with bank lenders.
Landlords affected by the situation were those that had taken out ‘stand-alone swaps’ with banks to guard against interest rate increases.
The Tenants Services Authority (TSA) had arranged emergency meetings with lenders to discuss the situation. Housing association chiefs called on the TSA to provide short-term guarantees for any landlords struggling to meet their obligations.
James Tickell, from housing consultancy Campbell Tickell, warned that landlords failing to come up with cash for the banks would be in default and could face insolvency.

Linked InTwitterFacebookeCard
Add New Comment
You must be logged in to comment.
RELATED STORIES