Notting Hill Genesis has posted a loss more than twice the previous year’s, while reporting £869.8m of available liquidity and reducing its debt. Both statements can be true. What the results reveal is the growing pressure of improving existing homes while finding the money to build new ones.
On the face of it, the numbers do not sit easily together. One of London’s largest housing associations has reported a deficit of £284.6m for the year to 31 March 2026. In the same results, it says it has £869.8m of available liquidity, reduced its net debt by £91m, raised £250m in new finance, completed 147,000 repairs and built 740 new homes.
Notting Hill Genesis (NHG), which owns or manages 66,803 homes, mostly in London, published its annual report and financial statements on 15 October. The deficit compares with £130m the previous year, an increase of £154.6m, or almost 119%. Turnover, meanwhile, rose from £717.9m to £756.9m, helped by higher rental income and first-tranche shared ownership sales.
There was an additional complication. The accounts arrived later than required under the association’s bond arrangements, after delays in its finance function supplying information to auditors. The delay led to the temporary suspension of the listing of certain NHG bonds from 1 October. In its September announcement, the association said it did not expect the completed accounts to receive a qualified audit opinion. The suspension concerned securities listings, not the operation of its housing services.
A deficit of that size will understandably worry residents, particularly when the landlord has already faced serious criticism over repairs, building safety and governance. But it does not mean NHG has run out of money. The more revealing question is how much of its financial capacity is now being absorbed by putting existing homes right, and what that leaves for the next generation of affordable housing.
What sits behind the £284.6m deficit?
The annual results show why revenue growth has not translated into a stronger financial outcome. Higher operating expenditure, property valuation adjustments and provisions for future obligations have combined to outweigh the additional income.
An accounting deficit is not the same as a cash loss. Buildings can be written down in value without money leaving the bank in that year, while provisions recognise obligations that may require payment over several years. That distinction helps explain how NHG can report a large deficit alongside positive operating cash flow and substantial financing arrangements.
According to the detailed figures presented in NHG’s annual report, the charges include a £112.4m reduction in the valuation of its private rented investment properties, £71.5m of housing-asset impairments and a £58.4m provision for building safety obligations. The report also records £32.8m of abortive costs and stock write-downs, with net financing costs of £137.7m partly offset by a £56.9m surplus on strategic asset sales.
These figures describe different accounting categories and should not simply be added together as though they were independent components of a single reconciliation. Nor should net financing costs automatically be treated as identical to cash interest paid.
Nevertheless, the underlying pressures are substantial. A reduction in asset values can weaken the balance sheet that supports borrowing, while provisions for safety work anticipate genuine future expenditure. The costs of debt, repairs and running existing buildings all compete for resources that NHG also needs to improve services and support new developments.
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| Financial measure | 2025/26 | 2024/25 |
|---|---|---|
| Turnover | £756.9m | £717.9m |
| Reported deficit | £284.6m | £130.0m |
| Net debt | £3,524.5m | £3,615.5m |
The comparison captures the tension in NHG’s position. Income increased by approximately 5.4%, and net debt fell by £91m, yet the annual deficit more than doubled. The association also reports £145.4m of net operating cash inflow and available liquidity of £869.8m, giving it financial resources and access to funding despite the deterioration in its reported result.
Those are important signs of resilience, but liquidity is not a pot of unrestricted money waiting to be spent. NHG must meet borrowing obligations, maintain its homes, fund safety works and preserve the financial headroom required by lenders. Its own results acknowledge pressure on interest cover, even while reporting compliance with loan covenants. The distinction between meeting those requirements today and having comfortable capacity to invest tomorrow is critical.
The cost of making existing homes safe
The financial pressure is visible in the work NHG must carry out across its housing portfolio. The association reports increased expenditure on routine repairs, damp and mould, fire safety and service charges that cannot be fully recovered. Service charge costs rose 27%, according to the annual report, placing further pressure on the landlord’s operating position.
Some of this spending is the consequence of problems that residents have been experiencing for years. More money devoted to repairs is not necessarily a sign of failure if it results in safer, better-maintained homes. But when the underlying condition of buildings requires substantial remedial work, a landlord has less flexibility about which costs it can postpone.
Stratford Halo in east London illustrates the consequences particularly sharply. NHG says structural defects linked by its advisers to the building’s original design required it to relocate and support 378 households. The annual report records £13m of decant costs during the year.
Those costs are more than an unfortunate entry in the accounts. For affected residents, relocation can mean prolonged uncertainty, disruption to family life and questions about when their homes will be safe to occupy again. For the association, the expense of supporting displaced households arises alongside the cost of investigating defects and finding a lasting solution.
Building safety remains a substantial commitment across the wider portfolio. The report estimates £173m of outstanding remediation expenditure, with £154m expected to be recovered from other parties. Of 221 blocks identified as needing further work, 53 were reported complete and another 43 underway.
The scale of the expected recoveries is significant, but an amount expected from developers, contractors or other responsible parties is not necessarily money already received. Recovery arrangements can be disputed or delayed, leaving the housing association to manage expenditure and cash flow while responsibility for the costs is resolved.
That creates an uncomfortable position for social landlords. Work to address serious defects may be essential regardless of whether full recovery is achieved. Delaying it can prolong risks to residents, yet undertaking it can place considerable demands on finances that are also needed for routine maintenance and new housing.
NHG’s operational results show some progress, although improvement is not uniform. The association reports that 80.3% of damp and mould visits were completed within 10 working days, compared with 79.9% the previous year. That is an improvement of just 0.4 percentage points, and the measure concerns visits rather than necessarily confirming that the underlying damp or mould problem has been permanently resolved.
For residents, that distinction matters more than a headline count of appointments. A prompt visit is useful, but it is the identification and lasting removal of the problem that determines whether a home is genuinely improving.
A smaller pipeline of new homes?
The contrast between housing completed and development started is one of the most revealing aspects of NHG’s results.
The association completed 740 homes during 2025/26, exceeding its target of 699. Yet it began construction on only 174, against a target of 333, and its report anticipates approximately 2,440 new homes over the next five years.
Starts and completions should not be compared as though they represent the same group of homes. Properties completed this year may have been commissioned and begun several years earlier. A lower number of starts does not establish the number of homes that will complete next year, and development programmes can change substantially as schemes progress.
It does, however, provide a warning about the flow of new projects entering construction. NHG has delivered homes from an existing pipeline while initiating a much smaller amount of work that will contribute to later completions.
That is particularly important in London, where housing associations are expected to provide affordable homes but must do so while managing the cost of existing stock. Their development capacity depends on borrowing, grant funding, land availability, sales income and the ability to generate sufficient financial returns. Higher spending on repairs and building safety is one constraint among several.
NHG’s strategy is increasingly focused on strengthening its core social housing business. It is progressing the sale of its Folio private rental operation and disposing of assets as part of a programme intended to simplify the organisation and reduce debt.
Such disposals can release capital and strengthen the balance sheet, but they may also change the future income generated by the portfolio. Their financial benefit depends on the proceeds received, the liabilities removed and the earnings surrendered. NHG’s restructuring should therefore be judged by whether it improves the resources available for its retained homes and future investment, rather than by the scale of disposals alone.
There is a legitimate counterargument to the suggestion that spending on existing buildings diminishes housing supply. A safe home kept in use remains part of London’s affordable housing stock. Repairing structural defects, addressing damp and mould and improving fire safety protect homes that residents already depend upon.
But housing associations cannot indefinitely expand both maintenance commitments and development programmes without the financial capacity to support them. NHG’s results show what happens when historic building liabilities and current service expectations place greater demands on that capacity.
The £284.6m deficit cannot be translated into a number of homes that will not be built, and NHG’s development slowdown has not been shown to result from any single cause. What the results do establish is that restoring financial strength and addressing existing housing obligations are central to the association’s future development decisions.
The regulator’s findings remain an important test
Financial performance is only one measure of NHG’s ability to deliver on its responsibilities. The Regulator of Social Housing’s most recent published judgement, dated 27 November 2024, awarded the association a C3 consumer grade, downgraded its governance rating to G3 and retained its financial viability grade at V2.
The consumer grade indicated serious failings requiring significant improvement, particularly under the Safety and Quality Standard. The regulator found problems with repairs timescales, fire remediation and assurance that legal safety requirements had been met in homes managed by external agents. It also identified weaknesses in business planning, risk management and governance oversight.
The V2 rating was more reassuring, but not an unconditional endorsement of the finances. It meant NHG met the regulator’s viability requirements while needing to manage material risks carefully.
That judgement is nearly two years old. It would be wrong to describe it as a fresh assessment of the association’s October 2026 position, or to assume that all the shortcomings identified in 2024 remain unchanged.
NHG says the regulator agreed a programme to restore compliance in April 2025. Its annual report states that 61 of 76 milestones had been completed by March 2026. The association has also published updates on its regulatory improvement programme, describing work to strengthen governance, assurance, property information and resident services.
That progress is material, but it is reported by NHG. A new independent regulatory judgement would provide stronger evidence of how far the association has addressed the original concerns.
The delayed accounts add a further dimension. NHG’s September announcement specifically identified internal delays in providing information to its auditors. Those difficulties should not be assumed to have been caused by the governance weaknesses found in 2024, but they reinforce why reliable financial reporting, effective controls and credible oversight remain important measures of the association’s turnaround.
Leadership has also changed. Brendan Sarsfield became group board chair, while Helen Evans was appointed interim chief executive in September 2026. In NHG’s year-end statement, Evans said the organisation needed stronger cost control, better forecasting and operational improvements that translated into better outcomes for residents.
The test is whether those changes produce measurable results, rather than simply a stronger account of what the organisation intends to do.
What the figures mean for residents and future housing
The deficit does not itself change a tenant’s contractual rights or remove NHG’s repair and safety obligations. Nor does it mean the association can automatically pass its financial losses to residents through rent or service charge increases. Those charges remain subject to the applicable agreements, legislation and regulatory requirements.
The more immediate questions concern whether homes are becoming safer, repairs are being resolved consistently and outstanding building safety work is progressing. Residents affected by serious defects will want certainty about the work required and the timescales involved, while leaseholders and shared owners may reasonably expect clear explanations of building expenditure and any resulting charges.
The financial statements cannot answer every one of those questions. They show the resources being committed and the liabilities being recognised, but residents’ experience depends on what happens in their buildings and how promptly problems are resolved.
NHG’s next financial update, progress with the Folio disposal and any new judgement from the Regulator of Social Housing will help establish whether its recovery programme is delivering lasting improvements. Development starts also deserve attention, because the number of homes being completed today can disguise a thinner pipeline of schemes that have yet to begin.
For the wider property sector, this is not evidence that every housing association is facing the same degree of difficulty. NHG has a distinctive London portfolio, substantial building safety commitments and the particular financial and human consequences of Stratford Halo.
Nevertheless, the accounts illuminate a challenge that reaches well beyond one landlord. Social housing providers are expected to maintain and improve existing homes while helping to meet the need for additional affordable housing. Both responsibilities are essential, but neither can be separated from the financial strength of the organisations expected to deliver them.
The £284.6m deficit does not demonstrate that Notting Hill Genesis is unable to meet those responsibilities. Its liquidity, debt reduction and continued investment tell a more complicated story. What they cannot yet establish is whether the association has regained enough operational and financial strength to improve its existing homes while rebuilding the pipeline of new ones.
For residents, success will be measured in safe homes, completed repairs and dependable services. For London, it will also be measured in whether NHG can return to building at a level that makes a meaningful contribution to the city’s housing needs.
That is the question behind these results: not simply whether the association can improve its financial position, but what it will be able to deliver once it does.
This article reports published financial information, company announcements and regulatory findings as at 17 October 2026. It provides general news and analysis, not financial, legal or housing advice. The detailed figures drawn from NHG’s annual report are presented as the association’s reported figures. Individual tenancy rights, lease obligations and service charge liabilities depend on the applicable agreements and law.
