Scottish housing associations’ turnover jumps 60% to £780m

The turnover of Scottish housing associations has soared 60% – from £488m to £780m – in the 12 months to April 2004, a report by Communities Scotland has revealed.

This report included for the first time the totals from several large stock transfers, taking the number of homes owned by Scottish associations to 251,000.

This means housing associations now own about 40% of the social housing stock in Scotland.

The three principal stock transfers that caused the increase were 80,000 homes from Glasgow council to Glasgow Housing Association in March 2003; 6500 homes from Scottish Borders council to Scottish Borders Housing Association, also in March 2003; and 12,000 homes from Dumfries & Galloway council to Dumfries & Galloway Housing Partnership in April 2003.

These three transfers contributed £249m, or 32%, of the sector’s turnover. The sector generated a surplus of £116m in 2003/4, compared to £35m the previous year. Total lending stood at £2.3bn in 2003/4, compared to £2.2bn the previous year.

The Royal Bank of Scotland was the biggest lender in 2003/4, committing funds of £532m to the sector. The next biggest lenders were HBOS (£384m), Dunfermline Building Society (£246m), Abbey (£208m) and Nationwide (£207m).

But the two largest lenders actually lent less than they did the previous year. In 2002/3, RBS lent £556m, while HBOS lent £386m.

Alan West, director of housing finance at HBOS, said the three stock transfers had given a distorted impression of growth in the sector. “Outside of the transfers, I wouldn’t say there is huge growth, but we continue to have a strong appetite for the sector. The amount of funding in Scotland is growing in line with the sector,” he said.

David Bookbinder, policy coordinator at the Scottish Federation of Housing Associations, said the Scottish RSL sector would become more politically powerful as it expanded.

“This trend [of growth] is likely to continue as more and more stock transfers come through, and what it means is that we must ensure we continue to represent the views of the sector as effectively as possible, and the Scottish executive and Communities Scotland must take those views seriously,” he said. “We are increasingly the body in Scottish housing that cannot be ignored.”

The transfer of Edinburgh council’s 25,000 homes could be the next major stock transfer to go through in Scotland, although a ballot of tenants is not expected until next year.