Since 2017, the number of homes owned by for-profit registered housing providers has shot up more than 50-fold. But can they be considered a force for good in the sector or something to be feared? Either way, as Keith Cooper discovers, they are here to stay – and likely to get bigger.
There are some big claims circulating about so-called for-profit registered providers and their multi-billion-pound investors.
For-profits will triple in size from around 43,000 homes to 150,000 by 2030, the consultancy Savills claimed in its report, A Growing and Diversifying Sector, last year. “There’s a clear ambition from investors to scale up their portfolios,” it adds.
The investors themselves have offered “to unlock” £100bn of affordable housing funding by taking housing associations’ homes off their hands, wholesale. So says Sir John Kingman, the former Treasury minister and Legal & General Group chair, in an advice column to government, entitled “We’re going to need a bigger Bazooka”. “Insurers and pension funds would lap these [homes] up,” he says. “This would leave housing associations with huge new cash reserves…[and] unlock a large increase in social housebuilding,” he adds.
Even the US president appears to have given the growing band of for-profits in England a bump. Donald Trump’s planned ban on big US corporate investors buying up single family homes across the pond could prompt an acceleration of interest from investors, HQM has been told.
Key questions
So, what exactly are for-profit providers? Where have they come from and where are they going? And are their plans for expansion something to be celebrated or feared?
To find out HQM, has spoken to the three largest for-profit providers, scoured official figures, and spoken to their advisers as well as the Regulator of Social Housing (RSH) which oversees both the centuries-old housing association sector and these for-profit newcomers.
For-profit registered providers were introduced by the Housing and Regeneration Act in 2008 with the first registrations allowed two years later. RSH figures show registrations dribbled in initially by two or so a year and that many of these first for-profit providers grew slowly, if at all. Most of the early adopters had fewer than 100 homes, according to an RSH stock take in 2020.
“We feel that what we do as a business is of great social value. There’s a significant housing crisis in this country, and we’re proud that we’re able to play a small part in providing much-needed homes”
Heylo
Investors showed more interest in for-profit providers in 2017 after the RSH lost its power to block them from selling their social homes as part of a deregulation drive by the then Conservative government. “This meant for-profits could trade more freely in social housing assets”, RSH deputy chief executive Jonathan Walters told HQM.
“Registered providers do have to tell us when they are selling homes and we can launch a regulatory investigation or follow up if we need to. But we don’t have any formal blocking power,” Mr Walters adds.
Moat Homes
The RSH soon showed it would act on social housing trades which fell short of its remaining regulatory rules. In 2018, it downgraded the governance rating of non-profit association Moat Homes for “insufficiently robust” due diligence in its sale of 26 occupied homes for older people to a small for-profit provider.
Board approval for the sale had been considered “solely on financial criteria” the RSH judgement states. “Due diligence of the proposed purchaser was insufficiently robust to demonstrate accountability to tenants and obligations to protect social housing assets,” it adds. Moat Homes was approached for comment.
This early baring of what regulatory teeth it had left didn’t deter investors from backing for-profit providers. Instead, the number of for-profit registrations began to rise. Legal & General had its first for-profit provider granted registered provider status in late 2018 and has registered several more since then.
Around this same time, a small trade began to develop in the for-profits organisations which had already registered. These could now be bought off the shelf by investors instead of them registering their own organisations, a lengthier process involving more stringent checks by the RSH. This trade has recently become highly lucrative with registered for-profits changing hands for six-figure sums, despite some being no more than shell companies with no homes and no staff, HQM understands.
Heylo and Sage
Two of the biggest for-profit providers today, Helyo and Sage Housing, began by purchasing existing providers.
Heylo, was established in 2017 by purchasing Three Conditions, a for-profit which had registered with the RSH five years beforehand. The company’s 2017 accounts described Three Conditions as an “intending provider of affordable housing but hadn’t acquired any properties”.
Heylo says it has since attracted more than £2bn of “global capital” to invest in affordable homes through this previously redundant organisation. It’s gone from zero to 10,000 shared ownership homes in nine years and has plans to expand over the coming years. “We feel that what we do as a business is of great social value,” a spokeswoman told HQM. “There’s a significant housing crisis in this country, and we’re proud that we’re able to play a small part in providing much-needed homes,” she added.
“Regardless of how a provider is acquired, they must meet all our standards and we’ll use a range of tools to check they’re doing so”
Jonathan Walters, deputy chief executive, Regulator of Social Housing
Sage Housing also joined the for-profit sector by purchasing a provider formerly known as ‘180 Housing’ in 2017, according to Companies House records. By the end of that calendar year, this entity owned just four homes. But backed by billions of pounds from investment industry titans Regis and Blackstone, it claims to have delivered 20,000 homes over the past five years and is now England’s “largest provider of new affordable homes”. Sage Housing has the RSH’s highest rating for governance (G1) and ranks highly in tenant satisfaction measures with 86% of its rental customers satisfied in 2024/25, it says.
‘Real problem’
Mr Walters says the ability of for-profits to buy and insert a registered provider in a wider company structure was a “real problem”. “If they’re coming through the normal registration process we’ll ensure that what ends up on our register is something we regard as a proper organisation that’s able to manage its stock,” he adds. “Otherwise, the registered body can end up in a very odd structure where the RP is essentially a pass-through vehicle. But regardless of how a provider is acquired, they must meet all our standards and we’ll use a range of tools to check they’re doing so.”
While Mr Walters doesn’t name Heylo the RSH linked “serious regulatory concerns” about its financial viability and governance to its business model, in its first regulator judgement of the for-profit in 2022.
Under Heylo’s business model, the judgement alleges its registered provider has “nominal ownership” of its properties, derives “no economic interest” from them, and has “effectively ceded control of its social housing assets” to a series of companies connected to the provider, called ‘investment pods’. “All income is passed through to the investment pods via a managing agent, also connected to the Heylo group,” it adds. Heylo told HQM: “Work continues to restructure the business, and we meet regularly with the regulator to review progress.”
After the early sluggish growth in for-profit portfolios, the number of homes that they own has shot up more than 50-fold since 2017, from 873 to 46,555 in 2025. Sage Housing, L&G, and Heylo hold most of the for-profit stock, according to Savills.
‘Big pockets’
Consultants and advisers to for-profits say they expect this sub-sector to expand further this year as investors “with big pockets” enter market, interest from those in the US is likely to “accelerate”, and housing associations put “large portfolios” of homes on the market which only for-profits can afford. L&G has reaffirmed its “unashamed” offer to free up capital “trapped” on housing associations’ balance sheets by buying them up.
“‘We’re still getting interest from both investors and housebuilders in establishing new for-profit registered providers,” says Rob Beiley, a partner at law firm Trowers & Hamlins. “Even before Trump’s pronouncement, a number of north American investors have been speaking to us and this is likely to accelerate,” he adds. “‘The for-profit sector is one which is still growing.”
Steve Partridge, director of housing consultancy Savills, says he expects to see several key trends for for-profits this year and beyond. “They’re more likely to do more social rent. They’re looking at different ways of raising capital such as through local government pension schemes and US hedge funds; there are some people with really big pockets looking to enter the market,” he adds. “We’re also going to see more housing associations set up their own for-profits or enter into joint ventures with them or equity investors.”
“They [for-profit providers] are looking at different ways of raising capital such as through local government pension schemes and US hedge funds; there are some people with really big pockets looking to enter the market”
Steve Partridge, director, Savills
Mr Partridge says he also expects to see housing associations seek to raise capital funding by selling off their occupied homes. “There are a number of large portfolios of homes coming onto the market and realistically it’s only going to be for-profits or investors which can buy them.” He points to housing associations’ latest financial health check, the RSH’s Global Accounts, which shows a further deterioration in their financial health on several key measures, including their capacity to service their own debt.
L&G Group managing director of public investment Pete Gladwell reiterates Sir John’s suggestion that housing association sell-offs could “unlock” huge amounts of housing supply while helping them pay down their debt. He stresses that L&G does a “huge amount of its new delivery” but says there’s a “fundamental point” that should be considered by the sector.
‘Unashamed’
“There’s a lot of capital value and grant that’s trapped within housing associations at the moment,” Mr Gladwell adds.” If they [associations] move their existing homes to the right type of equity they can unlock huge amounts of additional supply, additional subsidy and economic growth and re-use those proceeds to pay down debt and deliver new homes,” he told HQM. “We’re totally unashamed that we think that more of this should be going on because there isn’t enough grant to go around and there’s huge amounts of trapped subsidy and capital within the existing registered provider sector.”
But is this all for the good?
Alan Green, a former development director for several major housing associations, is concerned that the level of indebtedness now borne by non-profits leaves them open to being “eviscerated as an investment opportunity”.
“Private sector investors make very positive noises about getting involved in low-cost housing but ultimately for them it comes down to value extraction as a simple investment asset” he adds. “Affordable housing is an essential service and so comparisons can be drawn to past privatisations of public services/utilities – what they promised, what they look like now and how happy are people with them.”
“We’re totally unashamed that we think that more of this should be going on because there isn’t enough grant to go around and there’s huge amounts of trapped subsidy and capital within the existing registered provider sector”
Pete Gladwell, managing director of public investment, L&G Group
But Mr Beiley says the thinking “in some parts of the sector” that not-for-profits are good and for-profits are bad was “hugely damaging”. “The reality is, there are good and bad landlords in all parts of the sector.”
And Mr Partridge points out that the government plans to invest just £4bn of the £19bn needed annually to build the 90,000 social-rented homes a year England requires. “And people still ask why we need them,” he adds.
The question of whether for-profits and their deep-pocketed investors are a force for good or bad for tenants is unlikely to be settled anytime soon. Meanwhile, they look set to become a much-needed source of funding and a permanent fixture on the affordable housing landscape.
