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Sometimes selling social housing makes both commercial and social sense

Neil Hadden defends his association Genesis from media criticism about its auctioning of homes


Neil   Hadden

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Neil   Hadden
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Why HAs sometimes need to sell social housing, by Neil Hadden @GenesisHousing #ukhousing

Neil Hadden hits back at media criticism of @GenesisHousing selling homes #ukhousing

Disposing of a social home is not a decision that we at Genesis would ever take lightly.

Last weekend’s Observer article trailing Monday’s Savills auction gave the false impression that disposals are a mere numbers game, aimed at maximising profits with scant regard for local housing need.

In reality, whenever a property becomes available, it is assessed against a complex series of parameters so we can determine whether it can be re-let, or if it would be better to sell it and use the proceeds to deliver more homes that meet modern standards and are easier to live in and maintain.

“In cases where Genesis is likely to make a significant loss through continued investment in a property, selling it may at times make more sense, from both commercial and social perspectives.”

We use a financial model that takes into account a newly void property’s rental income, average maintenance costs and the need for future investment, and use this formula to weigh up whether selling it or bringing it up to a better standard for a new occupant will best help us to fulfil our social purpose.

In cases where Genesis is likely to make a significant loss through continued investment in a property, selling it may at times make more sense, from both commercial and social perspectives.

Genesis’ original parent organisation, Paddington Churches Housing Association, was founded in the 1960s in response to severe housing need in west London. As a result, we have a very high proportion of mainly Victorian street properties in our heartlands – nearly a third of our total stock – and we are fully aware that some of these require significant investment.


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We have committed nearly half of our 2018/19 major works budget to bringing all street properties up to a suitable standard, but selling a property can be the more viable option in cases of severe disrepair, or where it simply doesn’t meet modern needs in terms of layout and access.

Far from rowing back on our social purpose, we have made and kept clear and strong commitments to providing significantly more social homes than we sell. Since 2009, we have sold 797 social rent homes, but built 2,525, including new properties in core and central areas.

This commitment is carried through in our future pipeline, with a high proportion of both social and affordable tenure homes to be delivered at Oaklands, the first new scheme on the Old Oak Common regeneration area in north-west London.

Our upcoming merger with Notting Hill Housing, which was also mentioned in the article, will enable us to both deliver and enhance our commitments to building new affordable properties across London and investing in our existing ones, despite scarce government funding and the difficult operating environment.

We have worked with residents on shaping a series of promises that we will make to them post-merger, and this includes a pledge to scale back the sell-off of social homes in all but the most severe disrepair cases or in areas where demand is very low.

“We need to evolve and innovate to keep in step with government policy and play the greatest role we can in helping to address London’s housing crisis”

And, via both organisations’ strategic partnerships with the Greater London Authority, we will be delivering thousands of new homes during the coming years, at social, London Affordable Rent and affordable rent levels, the latter of which will be kept down at around 60% of the market rental rate, rather than up to the 80% level permitted by government policy.

Genesis is as wedded to its social purpose as it was when Paddington Churches Housing Association housed its first family in 1965. However, we are clear that we need to evolve and innovate to keep in step with government policy and play the greatest role we can in helping to address London’s housing crisis and delivering high numbers of homes for those who can’t access them through the traditional market.

This demands an approach that is both social and commercial, and some decisions that, while they may not win support from all sides, are based on very careful consideration with the needs of all of our residents, and future residents, in mind.

Neil Hadden, chief executive, Genesis Housing Association

The Paper Trail: The Failure of Building Regulations

Read our in-depth investigation into how building regulations have changed over time and how this may have contributed to the Grenfell Tower fire:

Never Again campaign

Never Again campaign

Inside Housing has launched a campaign to improve fire safety following the Grenfell Tower fire

Never Again: campaign asks

Inside Housing is calling for immediate action to implement the learning from the Lakanal House fire, and a commitment to act – without delay – on learning from the Grenfell Tower tragedy as it becomes available.

LANDLORDS

  • Take immediate action to check cladding and external panels on tower blocks and take prompt, appropriate action to remedy any problems
  • Update risk assessments using an appropriate, qualified expert.
  • Commit to renewing assessments annually and after major repair or cladding work is carried out
  • Review and update evacuation policies and ‘stay put’ advice in light of risk assessments, and communicate clearly to residents

GOVERNMENT

  • Provide urgent advice on the installation and upkeep of external insulation
  • Update and clarify building regulations immediately – with a commitment to update if additional learning emerges at a later date from the Grenfell inquiry
  • Fund the retrofitting of sprinkler systems in all tower blocks across the UK (except where there are specific structural reasons not to do so)

We will submit evidence from our research to the Grenfell public inquiry.

The inquiry should look at why opportunities to implement learning that could have prevented the fire were missed, in order to ensure similar opportunities are acted on in the future.

 

READ MORE ABOUT THE CAMPAIGN HERE

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