Housing Corporation News Release

26 March 2008         ref: 24/08

Housing association sector turnover  up 9.4% to £9.1 billion, according to Global Accounts published today

Housing association sector turnover is up 9.4% to £9.1 billion according to the 2007 Global Accounts published today (Thursday 28 March 2008).

The sector grew faster than in the previous year, with turnover up by 9.4%, the value of housing association properties up 10% to £77.4 billion and surplus before tax grew 8.4% to £270 million despite the challenges faced.

The 2007 Global Accounts of housing associations provides a financial overview, based on published accounts data, of the housing association sector and some of its key segments and covers the period April 2006 to end March 2007.

For the first time, the Global Accounts are based on associations with more than 1,000 homes. In the past the cut-off point for inclusion has been 250 homes.   

Other highlights of the 2007 figures include:

• continuing growth in surplus on disposal (which has risen by 9% to £542 million). However, the rate of growth is slowing and the current year's position is down on the 19% increase between 2004-05 and 2005-06;

• levels of voids and bad debts reported by associations remain at historic lows, suggesting continued strong demand for their properties, together with good performance on rent collection;

• turnover on activities other than social housing lettings totals £1.28 million and represents 14.0% of turnover;

• year-end balances on cash and short-term investments increased by £261 million over 2006 levels.

Housing Corporation Director of Regulation Clare Miller said, "Over the past year the sector has continued to grow and perform well.

"Looking forward, the sector has challenges ahead with associations more exposed to a downturn in the property market than they would have been ten years ago. Overall operating costs are rising ahead of inflation and associations will need to secure real reductions if they are to retain their current levels of profitability.

However, despite these challenges, the sector continues to have significant capacity for more development. Financial forecasts put together by associations show plans to draw down private finance of £17 billion over the next five years. Providing there is sufficient liquidity in the lending market, we are confident that associations, plans are deliverable – and some have the capacity to deliver even more."

The housing sector delivered over 40,000 new homes funded with Social Housing Grant (SHG) in 2006-07 year and this rate of growth is expected to continue, with further targets for delivery of new homes over 40,000 in 2007-08 and an expectation of an increase in delivery to 2011.

Copies of the Global Accounts are available for download.

Ends.
 
For more press information please contact Sandra White on 020 7393 2094.

Notes to editors:

1)The housing association sector is diverse in both the size of associations that operate within it and the range of activities each undertakes. The sector comprises of around 1,950 associations. Of these, around 400 have more than 1,000 properties, representing more than 97% of the current stock in the sector of 2.2. million homes.

2)The Housing Corporation is responsible for regulating housing associations, which provide some two million homes across England. 

3)The Housing Corporation is the Government's national affordable homes agency, responsible for investing in new affordable homes and regulating nearly 2,000 housing associations across England. The Corporation's £8 billion investment programme for 2008-11 is its biggest ever. Its previous investment programme of £3.9 billion for 2006-08 is funding 84,000 homes; 49,000 of these are for affordable rent, and 35,000 are for affordable sale through the Government's HomeBuy initiatives, helping people to get a foot on the property ladder.

4) The Housing Corporation is working with English Partnerships and Communities and Local Government to establish the proposed Homes and Communities Agency and Office for Tenants and Social Landlords.