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Social landlords to borrow £12bn by 2020, says Standard & Poor’s
Social housing providers in the UK will take on another £12bn of debt by 2020, according to a new report.
Borrowing is expected to climb 5% a year over the next three years to £89bn as housing associations respond to government calls for increased delivery.
The research was conducted by credit agency Standard & Poor’s (S&P) Global Ratings.
It predicts that landlords will build more than 50,000 homes a year up to 2020, up from 47,000 completed in 2017.
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Landlords in England, which account for 90% of the UK-wide sector debt, will borrow more to mitigate the effects of the 1% rent cut and “higher exposure to market-related activities”, S&P said.
The report’s authors anticipate funding conditions to get tougher as interest rates rise and Brexit restricts access to the European Investment Bank, including the Affordable Housing Finance scheme which it part-funded.
But they said associations’ finances would “remain resilient” in the coming period.
A copy of the report is attached below.
