The social housing sectoris diverse, with over 1,700 registered providers in the UK, varying in size from under 10 homes to more than 50,000. Of these, most are small players, but the top 100 hold larger portfolios and much of the sector’s development capacity, and a series of significant mergers have taken place over the past couple of years to achieve economies of scale and greater development influence.
In 2017-18, total UK housing association stock is estimated to have increased and they now account for around 60% of social housing stock. Around 75% of market stock owned or managed by housing associations is general needs housing, which is primarily social rental accommodation.
The social housing sector is currently experiencing funding issues influenced by increased financial constraints on local authorities and social rent cuts of 1% a year from 2016-17 to 2019-20. This has led to reduced discretionary spending on maintenance and improvements by housing associations. The UK social housing market also continues to face acute supply problems, with new build levels below requirements. The Affordable Rent model is also influencing the social housing sector.
Prospects for the sector in the short-medium term remain challenging. The limited grant funding under the AHP, driven by the emphasis on the Affordable Rent investment model, has prompted Social Housing providers to seek finance and support from alternative sources, with some forming partnerships with private sector providers.