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Housing association committed development forecasts down by 43% as unsold units increase

Economic uncertainty brought about by coronavirus has caused registered providers to revise downwards their forecast expenditure on development, while the number of unsold market and shared ownership homes has increased.

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The Regulator of Social Housing’s (RSH) quarterly survey covering January to March 2020 found that the pandemic has caused “unprecedented challenges” for registered providers, which led to decreased development and housing market exposure.

Forecast expenditure on committed development in quarter one of 2020/21 was £2.9bn but quarter four’s forecasts for the same period had decreased by 43% to £1.7bn, the RSH said.

Similarly, forecast uncommitted development expenditure for quarter one had decreased by 70%, from £1.4bn expected in the previous quarter to the £0.4bn included in the latest forecasts.

The survey, which is based on responses from 215 private registered providers which own or manage more than 1,000 homes, also noted an increase in unsold units.

In quarter four, the number of unsold affordable home ownership (AHO) units increased by 12% to reach 7,808 at the end of March. Roughly half were held by 18 providers.

The number of unsold market sale unit increased by 21% to 3,072 – the highest level recorded since data was first collected in June 2014. More than half of these were held by seven providers.


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Despite this, the English regulator said the social housing sector was in good financial health at the end of March, around the same time the government introduced lockdown measures, including a freeze on the housing market.

Fiona MacGregor, chief executive of the RSH, said: “Our quarterly survey shows that the social housing sector has started from a strong financial position to face the current crisis.

“In the months ahead, providers will need to keep a continuous watch on the risks to their viability and be prepared to take prompt action, particularly their liquidity and exposure to the housing market.

“We will continue to monitor the financial impacts, including on income collection, and support providers as needed.”

The regulator said it was clear that there will be a “significant economic downturn”, which will have the potential to impact rent arrears, sales, repairs and development over the financial year.

The impacts of lockdown restrictions and the significant increase in the number of Universal Credit claimants are expected to be felt in quarter one of 2020/21, the RSH said.

However, available cash in the sector increased by £1.2bn between December 2019 and March 2020 and £2.4bn of new finance was agreed over the same period.

The RSH previously urged small care and supported housing providers to get in contact if they are facing difficulty due to the coronavirus crisis.

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