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24 May 2016

Housing Sector Demonstrates Financial Resilience and Stability

The latest report on the financial statements of Welsh housing associations reveals a continued trend of resilience from the sector.

Despite shrinkage in other major industries, the report on the sector’s 2015 financial statements demonstrates that the Welsh housing sector remains a strong, safe and innovative sector to invest in with a turnover of £835m - an increase of £51m on 2014 figures. The sector has seen further growth with a £76m surplus in 2015 (£74m in 2014) and continues to be attractive to lenders and financial institutions.

Stuart Ropke, Chief Executive of Community Housing Cymru (CHC), the membership body for Welsh housing associations, said: “Once again, the 2015 report shows the sector’s strength, resilience and commercial attitude to accomplishing social objectives. Having access to safe, warm and affordable housing is the foundation for the well-being of communities across Wales, and we need a resilient sector to deliver this.

“The necessity for the sector to continue to create surpluses year-on-year is even more acute in times of unprecedented housing supply pressures. Accounting surpluses support additional borrowing which our members re-invest in vital new homes and services. Our sector, year after year, continues to invest in affordable housing and the report highlights that Welsh housing associations are on track to reach the target of 10,000 additional homes set during the last Assembly term.”

The sector delivered 89% of the total additional affordable housing built in Wales in 2014/15 which equated to more than 1,900 new homes. 517 of these homes were built without Social Housing Grant, proving that the sector is attracting alternative routes of affordable finance.

The sector has total capital and reserves of £850m, a rise of 5% on 2014. The sector’s gearing is now at 63%, an increase from 61% in 2014, demonstrating the commitment of Welsh housing associations to take on additional borrowing to help build essential new homes across Wales.

The report backs up the highly regarded status of the sector amongst industry peers, including CBI Cymru, who recently gave their backing to the Homes for Wales campaign’s call that investing in housing makes business sense for Wales.

Stuart Ropke added: “Collectively, the sector is a force to be reckoned with – we are tackling housing need across Wales, in addition to enhancing communities and providing much-needed services. In order to provide these services, it’s essential that the sector is financially robust. Although there are challenging times on the horizon, this report proves that the sector is resilient and will continue to provide a vital service across Wales.”

To view the full Global Accounts report click here: http://chcymru.org.uk/en/publications/global-accounts/