Affordable Rent ‘Not Worth the Risk’ Say Associations

Some of England’s largest housing associations could shun the government’s new affordable new rent regime because of the strain it will place on their balance sheets. The Homes and Communities Agency will shortly finalise details of the regime which will allow landlords to charge rents at up to 80 per cent of market rates. The government believes the policy will allow associations to boost their borrowing capacity and build 150,000 new homes by 2015. Associations are concerned that they are being asked to take on more risk and debt, which could adversely affect existing loan deals and damage their credit ratings. They also have reservations about the social consequences of pushing general needs tenants into more expensive tenures. Landlords are sceptical about the new regime’s ability to deliver the number of homes the government hopes for. One chief executive said adopting the affordable rent regime would halve its development output. Read more on Inside Housing.