Housing Associations and the Delivery of Affordable Housing

A new report by the Assembly’s Housing and Regeneration Committee has highlighted four key risks the housing association sector faces: including adapting to a new business model; delivering the Affordable Homes Programme by the March 2015 deadline; accountability to tenants; and the lack of clarity about funding levels post-2015. There are concerns that the new ‘affordable rent’ model – which allows housing associations to charge rents of up to 80 per cent of the market rate – could result in a sharp rise in rent arrears and potentially higher borrowing costs. The report also warns that the March 2015 deadline may need to be extended to maximise delivery of new homes following a ‘slow start’ in building affordable housing. The Mayor has committed to delivering 17,000 affordable rent homes by 2015. Recent figures show increased activity on affordable housing builds, but this level needs to be sustained until September 2013 for his 2015 target to be met.

The Committee also warns of a social housing gap as it finds that many housing associations will not be able to afford to deliver new housing at traditional social housing rents, wants clarity on where funding will come from in future and calls on the Mayor to support tenants in holding housing associations to account.