Inside Housing – Home – RSH Quarterly Survey: spend on existing homes continues to rise as investment in sector ‘remains robust’

The RSH pointed out that higher costs “resulted in net operating cashflows alone being insufficient to fund net interest payments”, with an average cash shortfall of £246m per quarter in the year to December 2025.

In contrast, there was a “slight reduction” in quarterly development spend, down to £3.7bn compared with a total of £3.9bn in both the quarters to December 2024 and December 2023.

The regulator’s previous Quarterly Survey, covering the three-month period from July to September, found that landlords had spent the lowest amount on development in four years, at £2.8bn.

“While the 12-month development forecast has increased marginally, projections for the coming year do not yet incorporate development under the new Social and Affordable Homes Programme [SAHP] as the programme opens for bids in February 2026,” the report said.

Drawn debt by providers increased by £2.7bn in the quarter, which the regulator said “boosted cash balances” by 17% to £4.2bn.

But the report said cash balances are expected to reduce to £2.9bn by December 2026, with 70% of providers forecasting a net cash outflow during this 12-month period.

The financial returns showed that cash interest cover, excluding sales, in the year to December 2025 remained at 78% and is “expected to remain constrained”, with forecast interest cover projected to total 67% over the next year.

This is consistent with forecasts from the previous two quarters, the regulator said. 

On sales, the RSH said affordable homeownership first tranche and market sales rose during the quarter, with the 18-month pipeline for this tenure increasing for the first time in a year.

The report said that rent convergence along with the SAHP are “intended to support long-term investment in the sector” and give providers “greater certainty in the regulatory environment”.

Meanwhile, new requirements such as the updated Decent Homes Standard, Minimum Energy Efficiency Standards and Awaab’s Law “set the framework within which providers must operate”, the regulator said. 

The report added: “PRPs should ensure their plans evolve in line with emerging opportunities and regulatory changes. 

“It is essential that providers understand and manage any additional risks, identify potential liquidity and covenant constraints, and maintain robust contingency strategies.”

Will Perry, director of strategy at the RSH, said: “We’re seeing repair and maintenance costs rising across the sector, though more slowly than in recent years.

“Despite this, investment in new homes is being sustained, and landlords are still able to secure the funding they need for new homes and maintain existing ones.

“Recent announcements on rents and the SAHP give providers the opportunity to make well-informed investment decisions, while maintaining a strong grip on financial risk.”