Housing association giant takes a more “cautious” approach to new build as it undershoots original development target by 600 homes

Clarion Housing Group’s completions in 2023/24 have fallen 24% year-on-year, as it takes a more “cautious” approach to development.


The 125,000-home housing association giant, in an unaudited trading update, confirmed it completed 1,538 homes in the year to 31 March, down on the 2,032 recorded for the previous year. The figure is also below its original annual target of 2,161 completions.

The reduction had been expected following a similar percentage decrease for the first half of the year.

Clarion said the figures reflected “The group’s decision to take a more cautious approach to development in light of challenging market conditions, along with some handover delays at the end of the year.”

The group said its full-year pre-tax surplus remained stable at £96m, compared to £95m the previous year. This was helped by a recovery in its operating surplus in the second half of the year. Its operating surplus, excluding one-off costs, fell 4% from £260m to £249m, compared to a 40% decrease in the first half of the year.

A spokesperson for Clarion said: “In the final quarter of 2023/24, we have seen increases in our operating surplus due to the completion of planned stock transfers and disposals along with a favourable movement in bad debt provisions.

“These unaudited results demonstrate a stable performance in the face of an operating environment that continues to be challenging.”

Earlier this year Clarion sold 747 homes to Portsmouth City Council and 140 homes to Milton Keynes-based Grand Union Housing Group.

Clarion’s turnover dipped slightly from £1bn to £991m. This was affected by Its outright market and shared ownership sales income falling from £226.8m to £152.2m year-on-year, with its margin dropping from 9.7% to 8.3%.

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It said sales activity in the final quarter improved compared to the previous quarter, with net sales reservations levels for both private sale and shared ownership combined up 33% quarter-on-quarter and 21% up on the same period in the prior year.

Clarion said it invested £107m in planned major works, compared to £122m the previous year, and an unchanged total of £23m in building safety works. Despite the drop in completions, Clarion increased its annual investment in new homes from £457m to £501m. 

Earlier this month, Clarion agreed a £150m credit facility with Dutch bank ABN AMRO Bank. Clarion said the new sustainability-linked facility will help deliver the association’s mission “to provide homes to those who need them most”. ABN AMRO and Clarion will agree on a set of sustainability key performance indicators for the facility in the coming months.

Clarion’s figures come just weeks after the Regulator of Social Housing’s latest quarterly survey showed that providers’ forecast development spend of £15.9bn over the next 12 months is at the lowest level since the start of the pandemic. 

The survey suggested providers are switching spend towards investing in existing homes instead in order to implement building safety and decarbonisation measures. The sector invested £3.1bn in capitalised repairs and maintenance in the 2023 calendar year, up from £3bn the previous year, while providers forecast spend of £3.9bn in 2024. Both the 12-month actual and 12-month forecast expenditure are the highest ever recorded’

Clarion’s full accounts are expected to be published in the Summer.