Housing associations have been exposed to higher cash flow volatility as a as a result of the annual 1% rent cut in social housing rents imposed on the sector by the government.
A report by ratings agency Moody’s found that almost 25% of the revenue loss has been mitigated through job cuts, with savings also coming from cuts to repairs and maintenance budgets.
In addition, the report said: “While English HAs have offset most of the rent cut through spending cuts, rated HAs have also explored other ways to generate additional income, such as outright market sales, shared-ownership schemes and charging market rents.
“However, these have exposed them to the cyclicality [sic] of the housing market and higher cash flow volatility.”
