The Regulator of Social Housing (RSH) has warned that the housing association sector is in a weaker financial position than it was a year ago as cash levels fall and interest cover tightens.

The RSH, in its quarterly survey for the three months to 30 June, reported that the combined available cash balances for larger English housing associations fell from £5.1bn to £4.6bn quarter-on-quarter. It said cash balances have fallen by £2bn over the previous five quarters and are forecast to drop further over the next 12 months “as reserves are used, primarily to fund development programmes.”