94,000-home group reports fall in annual development and warns government budget cuts will affect build rates
The chief executive of Scotland’s largest housing association has warned its future development pipeline depends on government grant funding as it reported a drop in its annual completions.
Wheatley Group, in its annual financial statement, said it completed 348 new homes in the year to 31 March, down on the 644 it delivered last year.
It said though it expects to hand over 700 homes in 2024/25, has 1,706 homes on site or due on site and believes it can hit its target of building 3,400 homes between 2021 and 2026. This target was revised down from an initial target of 5,500 homes.
However, boss Steven Henderson said: “While we are on track to meet our revised target of building up to 3,400 new homes by March 2026, Wheatley’s social landlords face a difficult economic environment.
“Our pipeline depends on the availability of government grant for new-build projects and we are working with our local authority partners and the Scottish government to consider options to grow the supply of much-needed affordable housing.”
The comments come after the Scottish government earlier this year cut the affordable housing budget for 2023/24 by nearly £200m, around 26%. The move prompted the Chartered Institute of Housing Scotland in March to declare “a housing emergency”
In its accounts, Wheatley Group said the budget reduction is “likely to have an impact on how many homes we can build.”
Wheatley reported a 2.6% drop in its annual turnover, from £423.6m to £412.6m 2023/24. Its turnover was hit by a £20m reduction in new-build grant income offset by an £11m increase in core social housing lettings revenue.
Wheatley’s overall surplus fell sharply from £16.4m to £4.6m, due in large part to a £7.4m increase in finance charges as the group borrowed to fund its new-build programme and an extra £2.7m in taxation costs.
The group increased its overall spend on existing homes from £172.7m to £186m, including a 13% increase in repairs spend from £97.5m to £110.1m, while capital works remaining steady at £75.9m compared to £75.2m
The accounts were published as the latest official figures show the overall number of new homes completed in Scotland in the year to June was 19,293, a reduction of 17% on the total for the same period last year.
Annual social housing sector completions fell 25%, from 5,053, to 3,501 over the same period.
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