Notting Hill Genesis reveals £82m annual deficit

At the half-year point, NHG reported a 79 per cent drop in surplus, which at the time it blamed on a sharp fall in home sales, higher repairs, and building and fire safety costs. 

In today’s update, the landlord said that despite the challenges of inflation and repair costs, the performance of its “core housing association business is commensurate with the prior year”.

The group said it made “good strategic progress” over the past financial year.

NHG’s performance on completions was more positive as the group handed over 822 homes – a 79 per cent rise on the previous year’s total of 459. Starts increased by a similar level to 847. 

However the group is dialling down its development and said it will focus on regeneration projects and schemes to which it is already committed.

It plans to deliver around 3,000 homes over the next five years – around 600 annually on average. 

“Inflation and higher interest rates have altered the economics of development, particularly for not-for-profit organisations like Notting Hill Genesis,” it said in the filing. 

“We have therefore concluded that continuing to develop new homes at the same rate would not be financially sustainable and would jeopardise our ability to make the much-needed improvements to residents’ homes.”

Like many of its peers, the group is upping its spending on existing stock and said it will increase its investment from £500m over the next 10 years to £770m.

NHG currently has group debt facilities of £4.36bn, of which £3.6bn is drawn, and £768.1m undrawn, it disclosed today. 

A full-year turnover figure was not included as part of the unaudited results. 

Other major landlords have also suffered financially due to the challenges facing the sector. 

Last month, Metropolitan Thames Valley Housing revealed that it had fallen to an annual deficit of £80.2m, after booking £110m in one-off costs, including fire safety remediation work.

Southern Housing, which operates 77,000 homes, also reported last month an annual surplus of just £3m, which was a 93 per cent drop year-on-year.