PI's: Reinvestment %
Regulator for Social Housing: Reinvestment %
RSH 304: Reinvestment %
Rationale, Definition & Worked Example
Below you can find information regarding the rationale, definition and formula for this performance indicator. This includes a worked example to demonstrate how this indicator should be calculated.
Rationale
This metric looks at the investment in properties (existing stock as well as New Supply) as a percentage of the value of total properties held.
Definition
This metric measures the level of investment a provider is making into its housing stock (both new and existing) as a proportion of the total value of its housing assets.It includes spend on new development, acquisitions, and capital works to existing properties, and compares this to the overall value of housing properties held at year end.A higher percentage indicates a greater level of reinvestment in stock, which may reflect growth, regeneration, or ongoing asset quality improvements.
Formula
Reinvestment % = [A ÷ B] x 100
A = [Properties Acquired (total housing properties)
+ Development of new properties (total housing properties)
+ Works to Existing (total housing properties)
+ Capitalised Interest (total housing properties)
+ Schemes completed (total housing properties)]
B = [Tangible fixed assets: Housing properties at cost (Period end) / Tangible fixed assets: Housing properties at valuation (Period end)]
NB Cost is the net book value after any depreciation rather than just the cost of properties if the intention is to use the word cost as it is used in the Global Accounts.
If you use a different version of cost, you must indicate in the profile data for your organisation whether properties are held at historic cost, deemed cost or valuation.
A = [Properties Acquired (total housing properties)
+ Development of new properties (total housing properties)
+ Works to Existing (total housing properties)
+ Capitalised Interest (total housing properties)
+ Schemes completed (total housing properties)]
B = [Tangible fixed assets: Housing properties at cost (Period end) / Tangible fixed assets: Housing properties at valuation (Period end)]
NB Cost is the net book value after any depreciation rather than just the cost of properties if the intention is to use the word cost as it is used in the Global Accounts.
If you use a different version of cost, you must indicate in the profile data for your organisation whether properties are held at historic cost, deemed cost or valuation.
Worked Example
Properties acquired = £5,000,000
Development of new properties = £10,000,000
Works to existing stock = £3,000,000
Capitalised interest = £1,000,000
Properties acquired = £5,000,000
Development of new properties = £10,000,000
Works to existing stock = £3,000,000
Capitalised interest = £1,000,000
Schemes completed = £1,000,000
Total reinvestment (A) = £20,000,000
Total housing property value (B) = £200,000,000
Calculation:
£20,000,000 ÷ £200,000,000 × 100 = 10%