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Affordable Homes Guarantee Scheme attracts interest from 30 potential borrowers
A £3bn government-backed guarantee scheme to provide housing associations with low-cost loans has received interest from around 30 potential borrowers, Inside Housing has learned.
The £3bn Affordable Homes Guarantee Scheme (AHGS), announced by then-chancellor Philip Hammond at the 2019 Spring Budget, aims to provide 30,000 affordable homes using loans underwritten by the government.
The scheme, which will be run by Saltaire Housing, a subsidiary of investment manager ARA Venn, is not yet open for applications but has received preliminary enquiries from dozens of housing associations looking to access cheap borrowing.
Richard Green, partner and portfolio manager of AHGS at ARA Venn, told Inside Housing: “Ahead of the scheme’s three-year window for applications that will open very shortly, when we will make an application pack available and the marketing of our loans begins, we have had around 30 enquiries about potential loans from those that have been in touch with us already following our appointment to run the scheme late last year, which has been really encouraging.”
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Mr Green has previously stated that the scheme will look to issue 30-year bonds at around 40 to 50 basis points over gilts – the government cost of borrowing.
The scheme follows the Affordable Homes Guarantee Programme, which ran between 2013 and 2016 and issued £3.24bn for 62 housing associations in total.
Run by a subsidiary of The Housing Finance Corporation (THFC), this predecessor scheme is estimated to have supported the delivery of 32,000 new affordable homes with associations saving and average of 1% on interest rates and combined savings of £32m.
ARA Venn has been contracted to run the new scheme for an initial period of three years, with the option of a two-year extension at the end of the term.
The firm has appointed a host of social housing experts to the board of Saltaire Housing including former housing minister Mark Prisk and individuals who have held positions at Peabody, M&G Investments and the Regulator of Social Housing.
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