NatWest to provide £5 billion lending to UK social housing
NatWest Group, the UK-headquartered banking organisation, announced that it will provide £5 billion lending to the UK social housing sector over three years to improve living conditions and support a pipeline of new homes. The new pledge takes total lending to UK housing associations to over £11 billion between 2020 and 2026.
“We support around 200 housing associations across the UK, and are proud to announce our ambition to provide a further £5 billion in funding to support the housing association sector by the end of 2026,” said Robert Begbie, CEO, commercial and institutional banking, NatWest Group. “Against a backdrop of inflation and rising living costs, pressures on the housing sector and homeowners have increased. These increasing costs reduce the capacity to deal with other priorities such as new and upgraded housing, and tackling the critical challenges of energy efficiency, fire and tenant safety.”
According to a recent report by CEBR (Centre for Economic and Business Research), National Housing Federation and Shelter, social homes are more stable than private renting, as tenancies are secure, leading to better socioeconomic outcomes and increasing rates of employment. The report also found that in 2023 there was a net loss of nearly 12,000 social homes, while 1.3 million households are on a waiting list in England.
This lending should help the housing associations sector to deliver a pipeline of new homes and improve living conditions in existing properties, thus improving the availability and quality of social housing in the UK. Alongside the construction of new properties, this lending could also help housing associations finance energy efficiency and environmental solutions, such as retrofits.
NatWest has long supported the housing association sector. In February 2021, the bank issued a €1 billion affordable housing social bond, the first of its kind by a UK bank, using the bond proceeds to finance or refinance loans to not-for-profit registered housing associations operating in the UK.
NatWest Group has also helped the sector across the UK through other brands. Its Ulster Bank brand in Northern Ireland recently concluded a £70 million loan to social housing developer Choice Housing which plans to deliver nearly 1,000 new homes across Northern Ireland.
In Scotland a £96 million loan was provided to enable Aberdeen-based Grampian Housing Association (GHA) to finance the development of 1,000 new sustainable homes in the region. The loan provides GHA with the necessary flexibility to continue supporting its communities and tenants, where it currently provides services to over 4,000 households.
The bank has also intensified its work with The Royal Foundation’s Homewards programme, whose aim is to prevent and end homelessness. The programme has identified the need to unlock more housing, and an important element of that is increased lending from banks focussed on social housing. With collaboration at the centre of Homewards’ mission, NatWest Group is actively engaging with the programme to explore how it can offer support and expertise to help prevent homelessness over the next five years.
