Despite a 30% uptick on the previous quarter, development spending in the social housing sector is still down 18% on the same period in 2019.
That’s according to the Regulator of Social Housing, which has published the results of its latest quarterly survey of the financial health of registered providers.
Expenditure in the quarter came in at £2.4bn, but this figure was still below both total forecast for the quarter of £3.3bn and the £26bn forecast for contractually committed schemes.
The report covers the period from 1 July 2020 to 30 September 2020, and although the sector may not be spending as much on developments as it was previously, states that the sector “remains financially strong with access to sufficient finance”.
There have been challenges posed by the COVID-19 pandemic, the report notes, but it also says that the sector retains a “good financial position overall”.
The Regulator notes that the sector has “good access to finance”, with total cash and undrawn facilities totalling £34.7bn at the end of the quarter.
During the quarter, new facilities totalling £4.5bn were arranged by 44 providers, with £1.2bn relating to the COVID Corporate Financing Facility.
Current asset sales in the quarter totalled £1bn, 23% higher than forecast.
Commenting on the report, Will Perry, director of Strategy at the Regulator of Social Housing, said: “The social housing sector continues to maintain a good financial position with forecasted improvement.
“Considerable challenges still remain, and providers will need to manage risk effectively to ensure that they can maintain services to tenants and plan and invest for the future.”
Arrears and rent
COVID-19 continues to affect arrears and void loss figures, largely due to increased unemployment, though not to the extent anticipated in June.
Further, rent collection rates have risen to a level more consistent with normal seasonal trends, with underlying cashflow performance remaining strong.
Forecasts for the next 12 months show performance and plans are starting to return to pre-COVID levels.
Forecast for major repairs spend is now similar to December 2019 projections, and forecasts for both sales receipts and development expenditure have increased since June.
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