Clarion’s market and shared ownership sales rise, but delays affect £439m spend on new homes

Clarion told the stock market: “There remains a chronic shortage of affordable housing in England, and we are pleased to have been able to increase the number of homes completed during the year.

“We retain a longer-term ambition to raise this level of delivery, but will continue to deliver our pipeline at a pace that allows us to maintain a resilient financial profile.”

Clarion did report an increase in homes completed over the period from 1, 538 to 1,727. This was just below a target of 1,828 homes.

Of these figures, 1,441 (83.4%) homes were for affordable tenures and 286 were private sales. The association’s future homes pipeline currently stands at 20,173, an annual increase from 19,694 homes.

For its wider financial performance, turnover was up around £100m to £1.086bn, generating an increased operating surplus before disposals of £195m.

The landlord’s post-disposal operating surplus was broadly the same year on year at £238m and its net surplus was up more than £10m to £94m.

Clarion said: “The increase in surplus is primarily due to improved operating performance, with the return to the inflation-linked rent formula driving revenue growth. 

“The group has continued to invest in its housing and property services and has also started to see the benefits of its strategic Connect initiative, which is focused on improving the customer experience and enhancing cost control.

“The lower level of disposal surplus reflects our more cautious approach to in-sector sales. Combined, these have resulted in increases in both operating surplus and net margin. While our underlying operating performance has been strong, we continue to review the need for year end impairments and provisions including building safety and remediation provisions.”

The housing association’s provisions for its remediation and building safety work are likely to come in at around £20m, although it is attempting to recover the costs from third parties.

Outside of its financial performance, earlier this month Clarion assembled a panel of thought leaders and professionals to explore the impact of climate change, alongside social and economic shifts.