The way value for money is being assessed is changing with the regulatory landscape
Overall operating margins in social housing have fallen since 2019 as landlords respond to pressure to invest in existing stock amid increasing regulatory demand, according to Housemark’s latest analysis.
The value for money metrics report revealed that overall operating margins across the sector have fallen from an average of 24% to 18.7% from 2019 to 2024/25.
This is attributed to the sharp rise in prices during 2021/22 coinciding with additional costs for improving safety and quality, leading landlords to invest larger proportions of surpluses back into existing homes.
Housemark also noted that the changing regulatory landscape is reshaping how boards and executives assess value for money, with greater emphasis on risk management, service quality and assurance rather than a singular focus on cost reduction or growth.
Jonathan Cox, chief research officer at Housemark, said: “Value for money in social housing has evolved. The data shows a sector that remains financially resilient, but one that is having to make far more careful and complex choices.
“As regulatory expectations increase, value is no longer about being the cheapest. It is about investing in safety, maintaining services and ensuring long-term sustainability while operating within tighter financial limits.”
Meanwhile, median EBITDA MRI interest cover tightened to 111.9% in 2024/25 from 122.0% the previous year as a result of providers’ shifting priorities, with median social housing completions standing at 1.30% of stock in 2024/25, down from 1.43% in 2023/24.
Housemark forecasts sector costs to rise by around 5% by the end of 2025/26, exceeding CPI inflation but at a slower rate than the most recent year on year increase.
The report was produced using data from 147 housing associations managing around 2.2 million homes across England.
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