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The week in housing: lease-based providers come under the regulator’s spotlight again
A weekly round-up of the most important headlines for housing professionals
Good afternoon everyone. It has been nearly two years since the English regulator published its in-depth report looking at the growth of lease-based providers in the social housing sector.
The report famously concluded that it was “hard to see” how housing associations that operate the equity-linked business model could comply with its standards. By that point the Regulator of Social Housing (RSH) had declared four such providers non-compliant and was investigating two more.
The model sees associations agree with investment funds to pay inflation-linked rents on the properties they manage. This happens almost exclusively in the specialist supported housing sector and provides an important number of homes for those that need this type of housing.
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In March last year, just before the coronavirus pandemic hit, the regulator pledged to become “more vocal” about its concerns over the lease-based model and said there may be “more judgements coming out and more engagement with freeholders”.
While the pandemic ensured that was limited last year, it appears the RSH is following through with that promise this year.
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This week more landlords came under its scrutiny, with the regulator finding that Hilldale Housing Association and Pivotal Housing Association had both breached the RSH’s Governance and Financial Viability and Rent standards.
This followed the news that Auckland Home Solutions, a lease-based provider in the North East of England, was put on the regulator’s ‘gradings under review’ list and is now being investigated over matters that may impact its regulatory compliance.
A number of other lease-based providers have been deemed non-compliant or been put on the gradings under review list in recent months, which, along with the actions this month, shows that the RSH’s scrutiny of this model is far from over.
Elsewhere, there was a flurry of development news this week.
Yesterday the government brought out its housebuilding figures, which revealed just how badly the COVID-19 pandemic has hit the construction sector – particularly after a widespread shutdown of sites last year.
The figures showed that there was an estimated 127,580 starts made in the 12 months to the end of December 2020. This is a 16% drop on the year before. However, there were signs of recovery. The statistics showed that in the three months to the end of December, completions had hit their highest quarterly number since 2007: reaching 46,950.
Looking ahead, the Scottish government unveiled its own ambitious targets for housebuilding. The Scottish National Party-led administration announced it aims to build 100,000 affordable homes over the next decade and that at least 70% of these will be social rent homes.
This week Inside Housing ran a report on an incident that saw a full window fall from the fifth storey of an L&Q-owned block in London and smash on the patio of a property below. Luckily, nobody was hurt.
L&Q did apologise for what it described as a “shocking and worrying incident” and said surveyors have assessed that there is “no further immediate risk”.
Other stories that were popular with readers this week was the news that Flagship Group is looking to roll out smart home tech to 20,000 of its homes and an announcement from John Lewis which indicated it is eyeing up affordable housing as an important revenue stream as it looked to diversify its business by ensuring 40% of profits do not come from retail in the future.
Finally, the Chartered Institute of Housing has introduced new professionalism standards for people working in the sector. The standards identify seven professional characteristics that staff should adhere to, and you can find more information on what they are here.
Jack Simpson, news editor
Editor’s picks: five must-read stories
- L&Q apologises after window falls from fifth-floor flat in ‘shocking and worrying incident
- Firm linked to non-compliant landlords sets up charitable organisation to acquire ‘struggling providers’
- John Lewis eyes affordable housing as revenue earner as it aims for 40% profits from ‘non-retail’ activities
- Housing association to roll out smart home tech across 20,000 homes in ‘largest deal of its kind’
- Mapping a mega-merger: Sanctuary and Southern’s proposed merger in numbers
