The Regulator of Social Housing has published the results of its latest quarterly survey of registered providers’ financial health, showing record levels of spending on repairs.
Providers’ strong access to finance enabled substantial investment in existing stock. Annual spend on capitalised major repairs was £2.3bn – the highest yearly record. Quarterly spend reached £771m by March 2022 – the highest quarterly figure on record.
The sector raised significant new capital and maintained its strong aggregate liquidity. Total debt facilities were £118.7bn by March 2022, including £12.5bn in new finance agreed by year end.
This is “sufficient to fund the sector’s interest costs, loan repayments and capital investment commitments over the next 12 months”, the Regulator says.
Quarterly investment in new homes was lower than the previous quarter, but matched pre-pandemic levels.
Investment over the financial year exceeded pre-pandemic levels; providers invested £12.7bn by March 2022, compared to £10.3bn in the previous year and £12.4bn in the year to March 2020. Investment in new homes is forecast to reach £17.5bn by March 2023.
Tenant arrears improved in the quarter, while void losses were consistent with the previous quarter. Providers reported that material and labour shortages continue to affect void repair times, and covid-related backlogs remain challenging.
Forecasts for next year suggest that providers intend to continue exceeding pre-pandemic levels of investment – in both new and existing homes.
Will Perry, Director of Strategy at RSH, said: “The social housing sector remains financially strong and continues to recover from the pandemic. Providers forecast even greater investment next year on new and existing homes.
“Looking ahead, providers will need to manage significant economic and practical headwinds while continuing to make substantial capital investment.
“It is crucial that Boards maintain a clear understanding of their existing stock, while closely monitoring rising inflation, interest rates and persistent supply chain challenges.”