Bromford’s spending on homes up 13% as demand to tackle damp and mould rises

Paul Walsh, chief finance officer at Bromford, said that a “strategic cost review” delivered £5m of savings, which was used to offset “higher-than-anticipated repairs and address instances of condensation, damp and mould in our homes”.

“We knew this year would be a challenge with cost inflation exceeding the rent cap, and we maintained our focus on driving efficiencies,” he said.

The rise in investment also came as Bromford revealed that it had 20 complaints against it upheld by the Housing Ombudsman during the year, including five for serious maladministration around repairs and complaint-handling. 

Robert Nettleton, the group’s chief executive, said he appreciated there is “more to do”. He added: “We recognise the ongoing challenges and continue to make improvements through key learnings.”

Finances

Bromford’s post-tax surplus, excluding fair value gains, rose to £67m, up from £64m the year before. 

However, this was below the budgeted £72m, which Mr Walsh said was “driven” by the extra £3m spent on repairs. 

On an operating basis, Bromford’s surplus rose from £91m to £95m, although it missed its target of £100m.

Meanwhile, turnover grew from £290m to £314m, above its £310m target, with 85 per cent coming from its core business of social housing.

Development and sales

Bromford completed 1,191 affordable homes in 2023-24, a drop from 1,265 in the previous year. This included 551 homes for social rent. Overall, it is aiming to deliver 11,000 “low-carbon” homes by 2032. 

The group sold 357 homes in the latest year, generating income of £40.4m. The figure was slightly down on last year’s sales income of £41.1m. 

Mr Walsh said first tranche shared ownership sales were “significantly better than budgeted”. 

However, he said that lower margins were seen on these first tranche sales, with a drop from 26 per cent in 2022-23 to 21 per cent in 2023-24.

Overall operating margin, including asset sales, reduced slightly year-on-year from 37 per cent to 35 per cent.

Mr Walsh said this was “largely a consequence” of these lower margins. 

New funding

Despite reporting cash and undrawn facilities of £538m, director of treasury Imran Mubeen said that Bromford will return to the market for new funding “over the coming year”.

This comes after the housing association secured a £75m revolving credit facility in February and £127m in funding in January.

Mr Mubeen said: “We will strengthen and develop our relationships with our existing investors and we will continue to explore opportunities to diversify our funding streams, building on the success of our inaugural roundtable with European investors.”