14 July 2006
Housing associations are raising an increasing amount of money from private lenders, a survey shows.
The annual review of private finance by the Housing Corporation shows registered social landlords raised £6.3bn from lenders in 2004/05, compared with £5.4bn the previous year and just £3.3bn in 2001/02.
The 16% increase in private borrowing in 2004/05 takes the total amount of private finance raised by RSLs to £35.9bn — three-quarters of which has been drawn down by landlords.
The study, published by the corporation on July 14, shows 18% of borrowing is used to fund new housing, while 21% is for stock transfers. Nearly half (46%) of the money raised in 2004/05 paid for refinancing.
A spokesman for the National Housing Federation said the study proved that RSLs continue to enjoy the confidence of lenders. 'They see associations as prudent financial managers,' he added.
Jon Rouse, the corporation's chief executive, said the fact that RSL finance remained buoyant was 'great news' for the sector. He also announced plans to review treasury management policy for housing associations to reflect changes since 1999.
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