UK Social Housing Regulatory Requirements¶
What a Housing Association Business Planning Tool Must Produce¶
Compiled: 18 February 2026
Table of Contents¶
- Financial Forecast Return (FFR)
- RSH Regulatory Standards
- Social Housing SORP & Accounting
- Lender Requirements & Covenants
- Building Safety Act & Awaab's Law
- ESG & Sustainability Reporting
- Stress Testing Requirements
- Key Outputs a Tool Must Generate
1. Financial Forecast Return (FFR)¶
The FFR is the primary regulatory submission required by the Regulator of Social Housing (RSH). It is the single most important output a business planning tool must produce.
Format & Submission¶
| Attribute | Detail |
|---|---|
| Format | Standardised Excel-based template |
| Submission portal | NROSH+ (nroshplus.regulatorofsocialhousing.org.uk) — manual entry or import template upload |
| Deadline | 30 June each year (earlier if board approves plan sooner — RSH encourages within 6 weeks of board approval) |
| Who must submit | All PRPs owning/managing ≥1,000 social housing units. Smaller providers may be required if deemed high-risk |
| Reporting basis | Group consolidated basis |
| Data precision | £000s to one decimal place |
| Forecast period | 30 years (regulatory focus on first 5 years) |
| Accompanying docs | Business plan + supporting board papers |
Template Structure (4 Parts)¶
Part 1 — Front Sheet¶
- Provider identification
- Year-end dates
- Full list of all registered and non-registered group entities/subsidiaries
- Confirmation of consolidated return
Part 2 — Financial Statements (Lines 1–132)¶
Statement of Comprehensive Income (SOCI) — Lines 1–59: - Line 1: Rents receivable - Line 2: Service charges - Lines 3–15: Other income (grants, first tranche sales, non-social housing) - Line 16: Management costs - Line 17: Service charge costs - Line 18: Routine maintenance - Line 19: Major repairs expenditure - Line 20: Planned maintenance - Lines 21–41: Depreciation, impairment, disposals, other costs - Line 42: Interest charges - Lines 43–59: Other comprehensive income items
Statement of Financial Position (SOFP) — Lines 60–101: - Housing properties (at cost or valuation) - Other tangible fixed assets - Investments - Properties for sale (current assets) - Debtors, cash - Short-term and long-term debt - Deferred grants - Pension provisions - Reserves
Statement of Cash Flow — Lines 102–132: - Operating activities cash flow - Investing activities (including new 2025 lines for disposal tracking) - Line 116: Sales to tenants (RTB/RTA), shared ownership staircasing, void property open market sales - Line 116a: Bulk sales to other providers - Financing activities
Part 3 — Assumptions & Tenure Inputs (Lines 1–160)¶
Assumption Inputs (Lines 1–15): - CPI inflation rate - RPI inflation rate - Base rate / LIBOR - Line 13: Percentage of fixed-rate debt (year-end position)
Stock Totals (Lines 16–22): - Overall housing unit numbers by year - Line 22: New bulk sales disclosure question
Social Tenures (Lines 23–115): - Detailed breakdown by tenure type: - General needs - Supported housing - Housing for older people - Low-cost home ownership (LCHO) - Affordable rent - Intermediate rent - For each: opening/closing unit numbers, average rents, new development units
Other Tenures (Lines 116–143): - Market rent - Student accommodation - Key worker - Non-social housing categories
Other Inputs (Lines 144–160): - Line 144a: Revenue building and fire safety costs - Line 145a: Capitalised building and fire safety costs (life-critical fire safety defects on buildings ≥11m) - Capital grant assumptions
Part 4 — Compliance Questions (Lines 1–24c)¶
- Financial covenant calculations
- Compliance confirmations
- Security questions
- Stock quality standard compliance
- Governance and Financial Viability Standard certifications
Recent Changes (2025 FFR)¶
- Simplified average rent calculations within tenure sections
- New lines for building and fire safety costs (separate identification)
- Enhanced disclosure of capital grant assumptions
- New bulk sales disclosure (Line 22)
- More granular asset disposal tracking (Lines 116/116a)
Key Official Sources¶
- RSH Data Requirements Letter: gov.uk/government/publications/letter-to-registered-providers-data-requirements-for-2025-26
- NROSH+ Portal: nroshplus.regulatorofsocialhousing.org.uk
- FFR Guidance Notes: Available within NROSH+ "Documents" section (registered users only)
- VfM Metrics Technical Note: gov.uk/guidance/value-for-money-metrics-technical-note
2. RSH Regulatory Standards¶
Three economic standards apply to private registered providers:
2.1 Governance and Financial Viability Standard¶
Providers must: - Maintain effective governance to deliver objectives transparently - Comply with all legislation and regulatory requirements - Be accountable to tenants, RSH, and stakeholders - Safeguard taxpayers' interests and sector reputation - Maintain robust risk management and internal controls - Ensure effective resource management for ongoing viability - Protect social housing assets - Boards are ultimately accountable
What a tool must demonstrate: The business plan maintains financial viability under all reasonable scenarios, with clear mitigation triggers.
2.2 Value for Money (VfM) Standard — 7 Key Metrics¶
These must be calculated, reported in annual accounts, and benchmarked against peers:
| # | Metric | Formula/Description |
|---|---|---|
| 1 | Reinvestment % | Investment in existing & new properties ÷ Total housing properties at cost/valuation |
| 2 | New supply delivered % | New social housing units delivered ÷ Total units owned/managed |
| 3 | Gearing % | Net debt ÷ Total housing properties at cost/valuation |
| 4 | EBITDA MRI Interest Cover | EBITDA (adjusted for major repairs) ÷ Interest payable — the primary RSH viability metric |
| 5 | Headline social housing cost per unit (£) | Total social housing costs ÷ Total units owned/managed |
| 6 | Operating margin % (social housing) | Operating surplus on SHL ÷ Turnover from SHL |
| 7 | Operating margin % (overall) | Overall operating surplus ÷ Overall turnover |
2024/25 sector context: - EBITDA MRI interest cover fell to 91% (lowest since 2009), recovery not expected until 2027/28 - Average headline cost per unit ~£3,730–£3,980 - Maintenance = ~50% of headline spend
2.3 Rent Standard¶
| Parameter | Rule |
|---|---|
| Annual increase cap | CPI + 1% (based on September CPI of prior year) |
| Formula rent tolerance | Up to 5% (general needs) / 10% (supported housing) |
| Affordable rent | ≤80% of market rent at initial let, then CPI + 1% |
| 2023/24 exception | 7% cap (temporary, due to high CPI) |
| 2024/25 onwards | CPI + 1% restored |
| 10-year settlement (from 2026) | CPI + 1% confirmed for 10 years |
| Rent convergence | £1/week uplift from 2027, £2/week from 2028 for below-formula rents |
| Income threshold | Excludes households with prior-year income >£60,000 |
What a tool must model: Rent forecasts per unit/tenure type, applying CPI + 1% with convergence uplifts, respecting formula rent caps and tolerances.
3. Social Housing SORP & Accounting Framework¶
Applicable Standards¶
- FRS 102 (UK GAAP) as the base standard
- Housing SORP (Statement of Recommended Practice) — sector-specific overlay
- Housing SORP 2026 (revised) applies from accounting periods beginning 1 January 2026; first March year-end affected = 31 March 2027
- RSH Accounting Direction for registered providers
Key Differences from Standard FRS 102¶
Property Classification (critical): | Category | Treatment | Examples | |---|---|---| | PPE (Property, Plant & Equipment) | Depreciated cost or revaluation | Social rent, affordable rent, shared ownership rental portion | | Investment Property | Fair value through P&L | Market rent, commercial properties | | Inventories | Lower of cost/NRV | Shared ownership equity portion, properties developed for sale |
Classification is by intended use of the property, not the organisation's overall mission. Mixed-tenure developments must be separated by tenure.
Social Housing Grant (SHG) Treatment: - Classified as non-exchange transaction (not customer revenue) - Can be recognised using performance model or accrual model - Recycled via Recycled Capital Grant Fund (RCGF) on disposal
Required Financial Statements: 1. Statement of Financial Position 2. Single Statement of Comprehensive Income (not separate income + OCI) 3. Statement of Changes in Equity 4. Statement of Cash Flows (mandatory for all, regardless of size) 5. Notes with material accounting policies
Segmental Reporting (Accounting Direction): - Social housing lettings (by tenure type) - Other social activities - Non-social housing activities - Operating surplus/deficit by segment - Void losses
Key Accounting Judgements to Model: - Definition of operating surplus/deficit - Property categorisation (PPE vs investment vs inventory) - Cash-generating units for impairment testing - Cost allocation in mixed-tenure developments - Shared ownership split (rental vs equity component) - Component accounting for housing properties (separate useful lives for structure, roof, kitchens, bathrooms, etc.)
Public Benefit Entity (PBE) Status¶
Most registered social housing providers are PBEs, which affects: - Grant accounting (non-exchange transactions) - Concessionary loan treatment - Related party disclosures
4. Lender Requirements & Covenants¶
Typical Loan Covenants¶
| Covenant | Typical Threshold | Description |
|---|---|---|
| Interest Cover Ratio (ICR) | ≥110%–130% | Operating surplus ÷ Interest payable (definitions vary by lender) |
| EBITDA MRI Interest Cover | ≥100%–120% | EBITDA adjusted for major repairs ÷ Interest |
| Gearing | ≤50%–70% | Net debt ÷ Total assets (or housing properties) |
| Asset Cover | ≥105%–150% | Value of charged assets ÷ Outstanding debt |
| Debt per unit | ≤£25,000–£40,000 | Total debt ÷ Number of units |
Note: Covenant definitions vary significantly between lenders. A tool must support configurable covenant calculations.
Lender Reporting Requirements¶
- Quarterly or semi-annual management accounts
- Annual audited financial statements
- Annual business plan / 30-year financial forecast
- Covenant compliance certificates (typically quarterly)
- Development programme updates
- Treasury management reports
- Board-approved budgets
- Notification of material events (covenant breaches, regulatory downgrades, significant disposals)
Key Lender Concerns (Current Environment)¶
- EBITDA MRI at sector-low of 91% — lenders scrutinising viability closely
- Total sector debt ~£105bn and rising
- Refinancing legacy debt at higher rates
- Impact of building safety/decarbonisation on future cash flows
- Development programme affordability
What a Tool Must Produce for Lenders¶
- Configurable covenant calculations (multiple definitions per covenant)
- Headroom analysis (distance from breach)
- Golden rules / compliance certificates
- Sensitivity analysis on covenants
- Debt maturity profiles
- Security pool analysis
5. Building Safety Act & Awaab's Law¶
Awaab's Law (Social Housing Regulation Act 2023)¶
| Phase | In Force | Scope | Key Timescales |
|---|---|---|---|
| Phase 1 | 27 October 2025 | Damp, mould, emergency hazards | Investigate: 10 working days; Make safe: 5 working days; Complete repairs: 12 weeks |
| Phase 2 | Late 2026 (expected) | Excess cold/heat, falls, structural, fire, electrical, hygiene | Similar timescales expected |
Financial Impact (Phase 1 alone): - Total estimated cost: £180.6 million (present value, 2025 prices) - Average annual: £16.5 million sector-wide - Of which £129.0m = additional staffing for faster repairs - £6.0m = familiarisation costs - £11.3m = written investigation summaries
Penalties: Unlimited fines from RSH + tenant legal claims for breach of statutory duty
Building Safety Act 2022¶
- Separate from Awaab's Law (which excludes cladding)
- Building Safety Levy from October 2026
- Heightened due diligence for higher-risk buildings (≥7 storeys / 18m+)
- Remediation Acceleration Plan for cladding
What a Tool Must Model¶
- Separate cost lines for:
- Building safety remediation (cladding, fire safety)
- Life-critical fire safety defects (buildings ≥11m) — as per FFR lines 144a/145a
- Awaab's Law compliance (staffing, repairs acceleration)
- Revenue vs capital split
- Impact on 30-year cash flows
- Stock condition survey integration
- Prioritisation modelling by building risk category
6. ESG & Sustainability Reporting¶
Sustainability Reporting Standard for Social Housing (SRS)¶
| Attribute | Detail |
|---|---|
| Launched | November 2020 |
| Current version | v2.0 |
| Status | Voluntary (but increasingly expected by lenders/investors; likely to become mandatory) |
| Coverage | 48 ESG criteria across 12 themes |
Core Themes: - Climate Change - Ecology - Resource Management - Affordability and Security - Building Safety - Resident Voice - Diversity & Governance - Staff Wellbeing - Supply Chain
EPC & Net Zero Requirements¶
| Target | Detail |
|---|---|
| EPC C by 2028 | Climate Change Committee target for all social homes |
| EPC C by 2030 | Government regulation for fuel-poor households |
| Net zero by 2050 | UK statutory target |
| Sector decarbonisation cost | £36 billion (NHF/Savills estimate) ≈ £3.5bn/year |
| Government funding | Warm Homes: Social Housing Fund — £754m in 2026/27 (64% increase from 2024) |
Cost Ranges per Property: - 84% of properties can reach EPC C for <5% of property value - Over half require <£5,000 - Some properties (hard-to-treat) can exceed £50,000 - Integrated new-build + retrofit strategy: £27m over 30 years (typical HA) vs £50m retrofit-only
What a Tool Must Model¶
- EPC band of each property/archetype
- Upgrade cost per property/archetype
- Phased retrofit programme (years 1–30)
- Government grant funding assumptions
- Carbon emissions trajectory (Scope 1, 2, 3)
- SRS metrics output
- Net zero pathway scenarios
7. Stress Testing Requirements¶
The RSH expects boards to test business plans against "genuine worst-case scenarios" with clear, pre-defined mitigation triggers.
Required Stress Test Scenarios¶
| Category | Scenario | Typical Test Range |
|---|---|---|
| Interest rates | Sustained high rates | +1% to +3% above base case |
| Inflation | High/low inflation divergence | CPI ±1–2% from assumption |
| Rent settlement | Below CPI + 1% / rent freeze | CPI + 0%, CPI - 1%, full freeze |
| Void rates | Increased voids | +1% to +5% above base |
| Arrears | Increased bad debts | +1% to +3% of rental income |
| Development costs | Cost overruns | +10% to +30% on programme |
| Sales market | Shared ownership / outright sales downturn | -10% to -30% on values; 50% volume reduction |
| Major repairs | Unexpected capital needs | +20% to +50% above plan |
| Building safety | Remediation costs | £10k–£50k+ per affected unit |
| Decarbonisation | Net zero cost escalation | +20% to +50% above plan |
| Combined / multi-variate | Multiple simultaneous shocks | Interest + rent + voids + arrears combined |
What Boards Must Demonstrate¶
- Impact — What happens to cash flow, covenants, peak debt under each scenario
- Mitigation triggers — Pre-defined thresholds that trigger actions (e.g., pause development, sell assets, renegotiate terms)
- Mitigation effectiveness — Proof that mitigations restore viability
- Timing — When would breach occur vs when mitigation must be activated
- Residual risk — What cannot be mitigated
What a Tool Must Produce¶
- Automated scenario modelling (toggle assumptions)
- Multi-variate stress testing (combine scenarios)
- Covenant headroom under each scenario
- Cash flow waterfall showing impact
- Break-even analysis (at what point does breach occur)
- Mitigation modelling (what-if recovery actions)
- Board-ready stress test summary reports
8. Key Outputs a Business Planning Tool Must Generate¶
Regulatory Outputs¶
- ✅ FFR Excel template — auto-populated, ready for NROSH+ upload (30-year forecast)
- ✅ VfM metrics — all 7 metrics calculated annually for 5+ years
- ✅ Rent calculations — CPI + 1% with convergence, by tenure type
- ✅ Covenant compliance reports — configurable for multiple lenders
- ✅ Stress test outputs — scenario analysis with mitigation modelling
Financial Statements¶
- ✅ Statement of Comprehensive Income — SORP-compliant, segmented
- ✅ Statement of Financial Position — with correct property classification
- ✅ Statement of Cash Flows — 30-year projection
- ✅ Segmental analysis — social housing lettings / other social / non-social
Operational Outputs¶
- ✅ Unit forecasts by tenure — opening/closing, development pipeline, disposals
- ✅ Rent roll projections — by tenure, with average rents
- ✅ Development programme — phased, with funding mix (grant, debt, cross-subsidy)
- ✅ Stock investment programme — component replacement, building safety, decarbonisation
Treasury & Debt¶
- ✅ Debt maturity profile — existing + new facilities
- ✅ Interest cost forecast — fixed/variable split
- ✅ Peak debt analysis — when maximum borrowing occurs
- ✅ Security pool — charged vs uncharged assets
- ✅ Refinancing risk analysis
Building Safety & Sustainability¶
- ✅ Building safety cost forecasts — revenue + capital, by building category
- ✅ Decarbonisation programme — EPC upgrade costs, phasing, grant assumptions
- ✅ SRS/ESG metrics — for sustainability reporting
- ✅ Carbon pathway — emissions trajectory to net zero
Board & Governance¶
- ✅ Board summary dashboard — key KPIs, traffic lights
- ✅ Stress test summary — scenarios, impacts, mitigations
- ✅ Peer benchmarking — VfM metrics vs sector medians
- ✅ Going concern assessment — 12-month + longer-term viability
Appendix: Key Software Competitors¶
The main business planning tools currently used by UK housing associations include:
| Tool | Provider | Users |
|---|---|---|
| HousingBrixx | MRI Software | 370+ providers |
| Brixx | Brixx Finance | Various |
| ProVal | Various | Larger HAs |
| Bespoke Excel models | In-house | Common for smaller HAs |
All must produce FFR-compliant output for NROSH+ submission.
Appendix: Key Regulatory Bodies & Links¶
| Body | Role | URL |
|---|---|---|
| RSH | Regulator of Social Housing | gov.uk/government/organisations/regulator-of-social-housing |
| NROSH+ | Data collection portal | nroshplus.regulatorofsocialhousing.org.uk |
| NHF | National Housing Federation (trade body) | housing.org.uk |
| CIH | Chartered Institute of Housing | cih.org |
| Homes England | Government housing agency / grant funder | gov.uk/government/organisations/homes-england |
This document should be updated as regulatory requirements evolve. Key annual milestones: FFR template release (March), FFR submission deadline (30 June), RSH Sector Risk Profile (annual), Global Accounts (annual).